FedEx has been trading in a narrow range since late January. The top band of this range is marked by the huge breakdown gap left behind back on December 19th. FDX fell over 12% that day, its biggest one day loss in over ten years, on news the company was lowering its forecast. Despite a rather aggressive post earnings selling wave that hit shares on March 20th the stock remained inside this narrow 14 week price pattern. As the new quarter begins FDX is setting up well for a fresh rally leg.
Since the December flush FDX has put in eight weekly highs between $187.00 and $182.00. Once this heavy resistance area is cleared the stock has plenty of room to run. In the near term we consider FDX a fairly low risk buy near current levels. On the downside a close back below $178.00 would violate Friday’s low indicating more sideways consolidation is ahead.
At time of publication we do not have a position in FDX.