Stock Ideas

Four Aerospace and Defense Stocks on a Rebound


Gary Christie


June 19, 2020

The S&P 500 Industrials index is the top performing sector index over the last month with a gain of 19% followed by real estate 17.48% and Financials 15.82%. The worst performing sector was health care which is flat on the month.  It is no coincidence that the Dow Jones index also happens to be the best performing index of the month with a gain of 11% at the time of this writing due to its large industrial stock weighting.

Digging deeper into the industrial sector, Airlines are up an impressive 64.3% in a month followed by Aerospace and transportation services companies.

The top airline in terms of performance are Spirit (SAVE) +150.3% United Airlines (UAL) + 97.29% and American Airlines (AAL) +87.83%.

Despite an impressive rebound in airlines over the last month, the U.S global Jets ETF (JETS) remains down 42% year to date leaving a lot of upside potential.

Back on May 1st I wrote an article titled “A couple of Airline Stocks Cleared for Takeoff” where we hunted for Bottom reversal technical patterns. Since then, airlines have been continuing to rebound.

This week we will use a similar strategy taking advantage of Trading Central’s Technical Insight screener to find Aerospace and Transportation stocks that are displaying bullish classic technical patterns as the sectors continue to outperform.

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What we found

Civil aviation and defense simulator trainer CAE Inc. (CAE: NYSE) Confirmed a Bottom triangle-Bottom Wedge reversal technical pattern.

JetBlue Airways (JBLU: NASDAQ) may have hit a bottom and seems to be turning around to form a new uptrend after confirming a Triple Bottom pattern.

Axon Enterprise Inc. (AAXN: NASDAQ) is in the development, manufacture, and sale of Conducted Energy Weapons designed for use by law enforcement, corrections, military forces, private security personnel, and private individuals for personal defense. The stock confirmed an Ascending Continuation Triangle pattern.

Heico Corp (HEI: NYSE) manufactures jet engines and aircraft components. It also supplies electronic equipment for agencies and contractors. Its stock confirmed a Bottom Triangle – Bottom Wedge pattern.Gary Christie is head of North American research at Trading Central in Ottawa.

The investment ideas presented here are for information only.  They do not constitute advice or a recommendation by Trading Central in respect of the investment in financial instruments. Investors should conduct further research before investing. Learn more.

Gary Christie

Head of North American Research
Gary has over 15 years in financial markets. Prior to joining TC, he served as an equity & derivatives specialist with TD Bank and Bank of America. Gary is regularly quoted in Bloomberg News, conducts many education and market outlook webinars for investment institutions all over the world and has been a guest speaker at the New York Traders Expo.
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