Stock of the day: FedEx

Today, February 16, according to various sources, is supposed to be the date of the Russian invasion of Ukraine. Of course, the quality of those sources is questionable. Markets are up today, showing a risk on mode and not really believing a war will take place, at least for the time being. This reversal created many interesting occasions to buy but in today’s piece I will talk about an asset that’s not enjoying the ride up – FedEx.

FedEx is having a quite nasty bearish setup on the chart right now. We can see, that after a significant drop in May, the price has been in a correction mode since October. A bullish correction managed to retrace only 50% of that drop. FedEx created a Head and Shoulders pattern (yellow), which can definitely be considered very negative.

Last week, the price dropped sharply and managed to break three crucial supports. The first one was the neckline of this pattern (red), the next one was at 23,6% and the third one was the horizontal support at 238.7 USD (green). Due to all these factors, the sell signal is on. The negative approach is strengthened after what happened yesterday. Almost the whole market was up but instead of creating a reversal, FedEx created a shooting star candle. A day like this, when even the worst performing companies rise but not FedEx, can be a good indicator for a future drop.