Technical Update - Airbus soaring above the clouds. Boeing in turbulence. Any sign of tailwind ahead? Technical Update - Airbus soaring above the clouds. Boeing in turbulence. Any sign of tailwind ahead? Technical Update - Airbus soaring above the clouds. Boeing in turbulence. Any sign of tailwind ahead?

Technical Update - Airbus soaring above the clouds. Boeing in turbulence. Any sign of tailwind ahead?

Equities 5 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

  • Boeing's recent price action includes a Bullish Engulfing pattern, indicating potential reversal, but the subsequent bearish candle suggests caution. The troubled plane maker could very well be hit with more selling pressure pushing Boeing to test key support at 176.25

     

  • Airbus shares have outperformed Boeing recently, but indicators suggest a potential for a correction. 
    Despite high RSI levels and recent Doji candles, the absence of divergence means the uptrend could persist, with key support levels identified for any pullback

On March 20th, Boeing exhibited a Bullish Engulfing pattern, signaling a potential reversal after testing significant support between 177.73 and 176.25. Despite this positive indicator, a bearish candle formed yesterday, casting doubt on the sustainability of the reversal.

For a more definitive bullish signal, Boeing needs to close above yesterday's high of 196.18, targeting the resistance at approximately 198.32. Overcoming this resistance could pave the way to stronger resistance levels between 215.16 and 217.70.

A daily closure above 217.70 would solidify a bullish outlook in both the short and medium term. The RSI's behavior is also pivotal; a close above the 60 threshold would indicate positive sentiment, supporting the potential for further upside.

Conversely, if Boeing fails to surpass 198.32, it may revisit the support zone between 177.73 and 176.25, challenging the validity of the recent bullish pattern.

The weekly chart emphasizes the critical nature of the 176.25 support level. Breaching this support could trigger a sell-off, with the next substantial support not until around 121, aside from a minor support at 141.88. This level aligns with the 1.382 Fibonacci projection from the October 2023 to March 2024 peak to trough, with the 1.618 projection nearing the September 2022 low at 121.

Source all charts and data: Saxo Group

Airbus has shown stronger performance compared to Boeing over the past few months, but current short-term indicators suggest the uptrend may be overstretched.
With the RSI above 80, signaling overbought conditions, and recent Doji candles indicating indecision, there's a hint that a reversal could be imminent. However, the lack of divergence in the RSI suggests that the stock could still have room to climb.

Should Airbus encounter a negative trading day following the "indecision" days, it will have formed a top and reversal pattern, with the lower rising trendline expected to be tested in such a scenario.
Key support levels at around 159.32 and 152.20.

In the medium term (weekly chart), Airbus is approaching the 100% Extension of the Q4 2022 to Q3 2023 uptrend at 172.52, suggesting trend exhaustion and a correction might be near.

If the RSI clsoes below its lower rising trendline, it could signal the start of this correction. Yet, with no RSI divergence observed even on the weekly chart, the potential for higher trading levels after a correction remains.

How much higher can Airbus fly?
The "Linton Price Target" Indicator points towards a target of 177, which is nearly reached. Any correction followed by a resumption of the uptrend could lead to a recalibration of this target.

(The Linton Price Target Indicator is developed by Updata Analytics and is based on Point&Figure charting and Fibonacci ratios)

Source: Update Analytics
Disclaimer

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000
Australia

Contact Saxo

Select region

Australia
Australia

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.