United Airlines Holdings Inc.
Higher oil prices raise fuel costs, which can reduce airline profit margins, the portion of revenue a company keeps as profit.
The Nasdaq is up 0.13% while the S&P 500 has shed 0.47% and industrials are down 1.18%.
Brent Crude Hits $116
Brent crude, a global oil price benchmark, rose to $116 a barrel on Friday, its highest level since June 2022 and above the peak recorded at the start of the war, according to Trading Economics. Prices have gained about 5% this week, a third consecutive weekly advance.
Airline Sector Context
Airline stocks are declining after rallying on Thursday, following Southwest Airlines'
Starlink Rollout
United Airlines CEO Scott Kirby told CNBC on Wednesday that 50% of flights would be on Starlink internet, with the full fleet enabled by the end of next year. Starlink is provided by Space Exploration Technologies Corp.
Technical Analysis
United Airlines is in a pullback phase on the intermediate trend, trading 6.5% below its 20-day SMA, 9.8% below its 50-day SMA, and 9.1% below its 200-day SMA - an alignment that typically keeps rallies "suspect" until price can reclaim at least the 20-day/50-day zone.
Even though the 50-day SMA remains above the 200-day SMA (the Golden Cross that occurred in June), the more recent 20-day SMA sitting below the 50-day SMA is a bearish crossover that points to near-term trend pressure.
From a levels standpoint, traders will likely treat the mid-to-upper $100s as the first area that needs to be repaired before the chart looks healthier again, while the October swing low remains an important reference for downside risk.
- Key Resistance: $118
- Key Support: $88
