Going forward into 2013 I am expecting ALK to see higher levels. In the short term I expect this (iii) wave to top around $62.75, while the end of iii wave to end near $67.76. Once we reach these levels I expect us to pullback in a larger fashion that may take a couple months to play out. My target for this iv wave is 46.50-51.50 before we can see the final rally later in 2013 taking us up to the higher target of $80!
Delta Air Lines (DAL)
Delta, Delta, Delta…. showing some swings as I type this. The airline looks like it has been on the runway from mid 2007-2012. But once 2013 came around the engines were fired up and ready for takeoff!
This longer-term chart shows the larger contracting triangle that has been playing out…. whipsawing investors as they buy the breakouts only to find the price reversing immediately. But now, there are enough waves in place to confidently count A-B-C-D-E and a breakout with an i-ii setup. This breakout from the triangle has already cleared some big resistance at $14.91 and has poked its head up through $16.19. It looks like we are still in wave iii of 1 with waves iv and v to come. Short-term I expect a pullback to $14.85-$13.33 in a wave iv of 1 ultimately to finish up all of wave 1 up at the $19 region.
When I place the fibs on the chart for waves 3 and 5 it gives me a longer-term target of the $25-$32 region. Depending upon how long wave 2 wants to take these targets can still be seen in the later half of 2013… pending departure time.
Hawaiian Holdings (HA)
Put on your leis because Hawaiian Holdings is setup in a big way to breakout, and if you capture this move you could have a trip for two at the nicest resort in Maui. Sound easy enough?? Well maybe I got a little carried away, but nonetheless this chart looks positioned for a monster rally, so let me explain…
Just like in Deltas chart above, it was working on a larger triangle from 2007-2012… well, so is HA but its technicals are wound up like a compound bow ready to fire. All of the waves look to be complete if the E wave truncated, they do truncate and it happens more then you might think. But, if it did not truncate it can still drop down to $4.75 before it ignites the rally.
What really is interesting and so appealing is the MACD, it has been coiling since early 2009 and is reaching the point where it looks to breakout in a monster way. It could be easy to argue that since it hasn’t broken out, how do you know it’s going to be to the upside and not the downside? Very valid argument, but the count does not add up if you view this as bearish. Sure, I could be missing something…but in my eyes this is the most likely view of Hawaiian.
Since this is a triangle it can take its sweet time to complete before we get an answer of which direction it chooses, but my longer term upside can extend all the way to $14.50-$16.25. Its first resistance level is up above at $6.60, followed by $7.95 and ultimately the highs put in at $11.15, but after that its all blue skies to Hawaii.
Author: Peter Nitso
Twitter: @PeterNitso
Paper bought 19,372 ETFC Jan 2015 7 Puts for $.41 (7.9 times usual volume) when stock was trading $11.47
Paper bought 700 PFF Oct 41 Calls for $.175 (5.8 times usual volume) when stock was trading $40.33
Paper bought 500 NRGM July 25 Calls for $.80 (66.4 times usual volume) when stock was trading $23.50