After my article on FedEx (FDX) last week, I received several emails inquiring about other stocks that may be in the same/similar industry as FedEx. Some traders were simply interested in lesser price stocks than FDX to potentially trade now, while others wanted to watch some of FedEx’s competitors going into their respective upcoming earnings releases.
After doing a little research, I found (3) potential candidates that I thought were worth keeping an eye on both now and/or going into their earnings releases: UPS, EXPD, and UTIW. We have already analyzed UPS and EXPD, so today we will be looking at UTIW.
Below is a 1 yr. chart of UTIW (UTi Worlwide, Inc.) with my added notations:
Like EXPD, UTIW’s earnings do not come out for another couple of months, so this too is a stock worth making a trade on in the short term if you do not want to wait for the earnings release. UTIW is sandwiched between (2) important levels of $18 and $20. Currently UTIW is testing the $20 resistance again.
The Tale of the Tape: FDX released its 4th quarter earnings report last week and UTIW is in the same industry. Like UPS and EXPD, UTIW is a lesser-priced alternative to FDX and to those interested, UTIW also has earnings coming up on September 1st. The level of $20 is being tested as resistance and $18 would be expected support if UTIW were to drop lower. Depending on your view and market position, a short position could be entered on a rally up to $20, while a long position could be entered on a break above the $20 level. On the flip side, a long position could also be entered on a pullback to $18 or a short position on a break down below $18.
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!
Christian Tharp, CMT