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Southwest Airlines Needs Time

Published 11/18/2015, 04:56 PM
Updated 07/09/2023, 06:31 AM
LUV
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Southwest Airlines (N:LUV) had a strong run higher from a base at $8 since the end of 2012. 'Bags fly free' apparently worked -- at least until it entered 2015 when the stock started a pullback. LUV retraced 38.2% of the move up and then started back higher. Last week it made it back to resistance again, but then started a small pullback.

With the move back up, this makes for a trigger in a cup-and-handle pattern. The target is shown at 61.25. But it gets better. Along the way, Southwest printed a Golden Cross, with the 50-day SMA crossing up through the 200-day SMA. There's also a AB=CD pattern that commits to a target of 70 on the trigger over 46.50.

Southwest Airlines

Momentum is supportive with the RSI in the bullish zone, having reset and turned back higher. The MACD has pulled back a bit and a turn higher would also confirm the upside. Perhaps it's time to pack your portfolio and let LUV fly for the longer term.

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