timwest

PAIRS TRADE: JetBlue JBLU buy vs Delta DAL and SthWst Air LUV

NASDAQ:JBLU   JETBLUE AIRWAYS CORP
350 1 7
This is a starting point for looking at this trade setup.

Delta DAL and Southwest LUV have a massive performance spread over JetBlue JBLU             that, if closed, would yield a substantial profit.

I like the JBLU             chart because it has the appearance of having a top or "head and shoulders" pattern to make technical traders jump all over it. It had a recent breakdown which gave it the look that it would break-down but what appears to be the case is that the stock is actually accumulating and if it can climb just a little further it could squeeze out any shorts in a fast rally to a breakout.

What I can see here is that money is likely coming off the table in LUV and DAL and those stocks could come under pressure as investors cash out and move to other stocks in the group that offer more value.

Risk 5%, Reward 10%-15% in one month. Measure the pure price spread between these securities.
JBLU             vs DAL
JBLU             vs LUV

Tim 11:08AM EST 3/25/2014 JBLU             8.63 last +0.10
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Great analysis Mr West ! Spot on. What is your current assessment of the airlines industry? should it see more upside as long as Oil is being suppressed or do you think it has played itself out especially being this late in the year, profit taking will take hold through year end. Airlines are good defensive plays within stocks, and they have supported that correlation this year as well.
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