Delta Air Lines -DAL- Daily - Showing relative weakness, sell

482 6 5
Lately DAL hasn't kept pace with the advance in the SPY             , leaving me to wonder where all the table-pounding buyers have gone? I feel like a broken clock on DAL, constantly calling for a top in the chart, but once again the chart shows that something is wrong or that at the least there are sellers liquidating their positions as the price languishes relative to the S&P500             .

Tim 38.04 last 12:33PM EST 9/22/2014
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Do you think is still cheap this stock? Price Earnings 2.6 while the average for the sector is 32.81
timwest PRO elcololp
The P/E is a bit off-base with DAL. Must be some one-time factors.
It's trading at 0.81 times sales.
October 16, before market open, is the next earnings.
JBLU is trading at 0.55 times sales. (DAL is 60% more expensive than JBLU on that measure)
AAL is trading at 0.73 times sales. (DAL is 10% more expensive on than AAL on that measure)
UAL is trading at 0.47 times sales. (DAL is 80% more expensive than UAL on that measure)
So.... it's worth an extra look to see how DAL is coming up with its earnings.
See here... http://screencast.com/t/8Q1EvEGu And OptionMonster detected heavy buying in the October 36.50 calls, with more than 5,000 trading mostly for $2.11 to $2.18. http://finance.yahoo.com/news/calls-look-higher-altitude-delta-104527321.html
timwest PRO elcololp
Sometimes when people buy calls it is to hedge: They may be selling out their stock and replacing it with cheap calls. They might also be buying calls and selling stock short. SO, the options information needs to be understood from the perspective of who is putting the trade on and why and how long they plan to hold it. You can see if the trade is an "opening" trade or a "closing trade" and that makes a big difference too. There is so much to understand besides the trade of the options. Lastly, was the trade done on the ask side or the bid side. Since it is reported as "buying" most likely the trade was done of the "ask" side.
elcololp timwest
Tim , what do you think DAL is going to go now?
timwest PRO elcololp
It certainly could bounce, but I see it going lower. You can take off some shorts here and re-short up 1 ATR and keep trading around that position. Short +1 ATR and cover down 1 ATR. Repeat as often as possible.
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