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Airline companies basket

Market Opportunities - 27/09/2021

27 September, 2021

The example below uses Contracts For Difference (CFDs). Calculations are only on the price of the specific instrument on the date below and calculations indicate a possible opportunity for profit or loss. No representation or warranty is given as to the accuracy or completeness of this information, consequently any person acting on it does so entirely at their own risk.

Airline companies basket weekly uptrend opportunity based On 1.00 Lot Calculation:

  • EVENT: White House said last week, the United States will reopen in November to air travelers from 33 countries including China, India, Brazil and most of Europe who are fully vaccinated against COVID-19. The travel industry welcomed the upcoming changes with intense stock rise in the airliners sector as the move is likely to boost air passenger travel.
  • Lufthansa bookings increased by 40% after the announcement. The company continuously expanded their schedule between Europe and the U.S. in recent months to currently more than 200 weekly flights to 17 U.S. destinations.
  • British Airways has announced it is to suspend almost all its short-haul flights at Gatwick airport – its biggest hub after Heathrow. The company said that it saw an increase of nearly 700% in searches for holidays to key US destinations such as NY, Orlando, LA and Boston after US announced reopening in November.
  • Airline Industry group Eurocontrol reported that passenger numbers in August have recovered to 71% of 2019 levels.
  • Airlines have been among sectors worst affected by Covid and a full recovery could see stock prices rise to pre pandemic levels.
  • After the news was published last week, United Airlines went up 7.93%, and Delta went up 6.7%. British Airways parent IAG rose 8.31% while Air France-KLM went up 24%.

HISTORICAL PERFORMANCE

Company

Ticker

Current price

Upside potential*

This year price change

Average weekly volatility this year

DELTA AIRLINES

#DELTA

$43.80

30.92%

+11.39%

6.40%

UNITED AIRLINES

#UAL

$49.11

77.74%

+14.34%

7.60%

INTERNATIONAL AIRLINES GROUP

#IAG

184.12 pnc

255.92%

+8.95%

11.28%

EASYJET

#EZJ.L

716.66 pnc

101.07%

-19.09%

13.65%

LUFTHANSA

#LHA.DE

€6.57

147.67%

-43.36%

10.86%

AIRFRANCE

#AF.PA

€4.76

108.50%

-14.86%

11.91%

*Upside potential - percentage below pre-covid level (January 2020)

Source: Yahoo Finance

STOCK PRICE REACTION: BASED ON STATISTICAL ANALYSIS

Downside potential1

Upside Potential1

-5.49%

+8.93%

Potential Profit/Loss on 1 lot of every stock in the basket2

-$10,779

$19,698

-€9,213

€16,836

-£7,865

£14,372

-C$13,599

C$24,852

Data Source: Bloomberg

TARGET LEVELS: SUPPORT AND RESISTANCE

Company

Support

Current Price

Resistance

DELTA AIRLINES

41.40

43.80

47.71

UNITED AIRLINES

46.41

49.11

53.50

IAG

174.01

184.12

200.56

EASYJET

677.32

716.66

780.66

LUFTHANSA

6.21

6.57

7.41

AIR FRANCE

4.50

4.76

5.19

Source: Yahoo Finance

Note: Support and Resistance Levels have been calculated by using upside and downside potential figures.

Please note that past performance does not guarantee future performance.

1-Calculation Downside/Upside Potential: Based on technical analysis.

2-Profit/Loss Calculation (**): Based on 1 lot (*) on each of the six stocks (6 lots). Range: based on the statistical analysis.

* 1.00 lot is equivalent to 1000 units for Delta Airlines, United Airlines, International Airlines Group and EasyJet while 1.00 lot is equivalent to 10000 for Lufthansa and Air France.
** Calculations for exchange rate used as of 13:40 (GMT+1) 27/9/2021.
Fortrade recommends the use of Stop-Loss and Take-Profit, please speak to your Client Manager regarding their use.
*** You may wish to consider closing your position in profit, even if it is lower than suggested one
**** Trailing stop technique can protect the profit – Ask your Client Manager for more detail

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