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Sector Scan: Grounded Airlines

Most airline stocks I follow are looking bearish


Boeing has been in the news recently since the Federal Aviation Administration and other regulators to ground Boeing’s 787 Dreamliner planes because of electrical fire concerns related to the plane’s lithium ion battery. This really shook consumers—and the effect has rippled across other airline stocks. I thought I’d run my scanners over the sector to see exactly what the response was—and how you should respond.

Trending Down

These stocks are in upward trends that are temporarily leveling or pulling back. Most of the stocks in this category have the potential for a strong downtrend.

  • Boeing (NYSE:BA)
  • Northrop Grumman (NYSE:NOC)

With Boeing trading between $75 and $79, and Northrop Grumman trading between $67 and $70, options trades on these stocks should focus on strike prices between these levels.


These stocks are in upward trends, but are temporarily leveling or pulling back. Call options would be wise here to lean against the crowd.

  • General Dynamics (NYSE:GD)
  • Lockheed Martin Corporation (NYSE:LMT)

Resistance for General Dynamics is around $73 and around $95 for Lockheed Martin.

Backing and Filling

This stock has rallied way up higher prices to “fill” lower price areas. Again, call options would be wise.

  • United Technologies Corporation (NYSE:UTX)

InvestorPlace advisor Ken Trester is editor of the popular Maximum Options program. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.  Try Maximum Options today for 2 months for only $99.

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