FedEx (NYSE 🙂 worldwide shipping and delivery service is scheduled for today, after market closure. Analysts are pessimistic about today's report, citing competition, global economic headwind and trade uncertainty, and consensus estimates see EPS of $ 3.14 on revenue of $ 17.62 billion, compared with EPS of $ 4.03 and revenue of $ 17.8 billion in Q2.
The shares of the share have risen by 13.08% year-to-date, slightly higher than the 13.01% YTD. The shares closed yesterday with 2.5% higher, at $ 182.40. However, some analysts do not expect the current earnings report to drive up the stock, mainly due to concerns that Amazon (NASDAQ 🙂 is moving from a customer to a competitor, although according to Cowen analyst Helane Becker, the online retailing giant includes 3% of the total sales of FedEx
The threat from the Amazon is set against a backdrop of slowing global growth and rising growth, both of which could cause further serious setbacks for a business that transports business. Moreover, the imminent trade war with China has clear, direct consequences for the delivery industry. On the other hand, Bank of America believes that FedEx can turn its fortune by postponing half of the planned plane purchases at Boeing for two years and boosting the shares with a buyback of no less than $ 2.5 billion.
Both fundamentals and technicals indicate a mixed picture for the company and the shares, and the negative insights can be well proven, at least in the short term. The balance between supply and demand shows a short-term trend, in conflict with medium and long-term down trends.
The incredible rebound after the route planning in December was paused on February 13. Since then, the price has varied, with a downward tendency in a falling flag formation, bullish following the previous rally. The pattern development at the top of a falling channel since June – moved by the 100 DMA – increases the conflict between the trend in the short and medium term.
Prices in advance in a less steeply descending channel have varied since the record high of January 2018, with the 200 DMA falling to the bottom, above the top of the steeper shortly descending channel.
The next big step can determine the trend from short to medium term. An upward breakthrough of the flag would include an upward outbreak of the falling channel in the short term since June and the 100 DMA. Such a movement could recalibrate the trend towards a more moderate decline within the earlier descending channel, which has been in force since January. Then bulls would have to prove their dedication, with an upward breakthrough of that channel.
Meanwhile, the first upward outbreak could possibly cause an accumulation of orders – both through a short squeeze and triggered longs – to drive prices higher.
The RSI upward breakthrough suggests that this will happen.
Trading Strategies Long Position Setup
Conservative traders have to wait for an upward breakthrough from the upper limit of the descending channel, as well as the flag, including the 100 DMA, below $ 191. Then they would do well to wait for a return move to the confirm reversal, if the price of the flag and the top of the channel were to bounce, with at least a single long, green candle engulfing a red or small candle of both colors.
Moderate traders would wait for the same upward breakthrough as described above. They can also wait for the expected pullback, but for better participation, not necessarily for proof of the integrity of the falling flag.
Aggressive traders could enter into a contradictory trade and now continue for a long time, counting on the completion of the flag as indicated by the RSI, because a pessimistic view offers greater potential for a rise than a fall
Trade sample
Listing: $ 182
Stop-Loss: $ 178, lower than the lowest of the last four trading sessions
Risk: $ 4
Target: $ 194
Reward: $ 12
Risk Reward Ratio: 1: 3
