American Airlines (NASDAQ: AAL)

American Airlines Group Inc., through its subsidiaries, operates as a network air carrier. It provides scheduled air transportation services for passengers and cargo. As of December 31, 2016, the company operated a mainline fleet of 930 aircraft. It serves 350 destinations in approximately 50 countries, principally from its hubs in Charlotte, Chicago, Dallas/Fort Worth, Los Angeles, Miami, New York, Philadelphia, and Phoenix, as well as in Washington, D.C.

Take a look at the 1-year chart of American (NASDAQ: AAL) with the added notations:

From the end of December through January, AAL had formed a key level of support at $52 (red). The first week of February saw the stock break below that support. Not only did that mean lower prices for AAL, but also the $52 level should most likely act as resistance on future rallies, as it has done a few times already.

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The Tale of the Tape: AAL broke a key level of support at $152. A trader could enter a short position on any rallies up to or near $52 with a stop placed above the level. If the stock were to break back above the $52 level, a long position might be entered instead.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!

Christian Tharp, CMT

@cmtstockcoach

Simmons First National Corporation (NASDAQ: SFNC)

Simmons First National Corporation operates as a bank holding company for Simmons Bank that provides financial services to individuals and businesses.

Take a look at the 1-year chart of Simmons (NASDAQ: SFNC) below with added notations:

SFNC has been repeatedly stalling at the same resistance of $30 (red) for several months now. The stock has recently turned higher, and is currently sitting just under that level now. A solid close above the $30 mark should lead to another leg higher for SFNC.

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Total System Services, Inc. (NYSE: TSS)

Total System Services, Inc. provides payment processing, merchant, and related payment services to financial and nonfinancial institutions in the United States, Europe, Canada, Mexico, and internationally.

Take a look at the 1-year chart of Total (NYSE: TSS) below with my added notations:

Over the past 4 months, TSS has formed a trend line of support (blue). Always remember that any (2) points can start a trend line, but it’s the 3rd test and beyond that confirm its importance. A pullback to that line will provide trading opportunities, one way or another.

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Acuity Brands, Inc. (NYSE: AYI)

Acuity Brands, Inc. provides lighting and building management solutions and services for commercial, institutional, industrial, infrastructure, and residential applications in North America and internationally.

Take a look at the 1-year chart of Acuity (NYSE: AYI) with the added notations:

From the end of May up until January of this year, AYI had formed a very important level of support at $155 (blue). The last week of January saw the stock break below that support. Not only did that mean lower prices for AYI, but the $155 level will most likely act as resistance on future rallies, as it did yesterday.

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Papa John’s International, Inc. (NASDAQ: PZZA)

Papa John’s International, Inc. operates and franchises pizza delivery and carryout restaurants under the Papa John’s trademark in the United States and internationally. It operates through five segments: Domestic Company-Owned Restaurants, North America Commissaries, North America Franchising, International Operations, and All Others.

Take a look at the 1-year chart of Papa John’s (NYSE: PZZA) with the added notations:

1-year chart of Papa John’s (NYSE: PZZA)

PZZA has a key level of support at $55 (green). The stock just tested that support again last week, and traders might be able to expect more follow through from the bounce. However, if the $55 support level were to break, lower prices should follow.

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