Shares fell about 3.5% after the airline reported its first-quarter results, where it lost $2.9 billion and missed analysts’ bottom-line estimates.
On the plus side, management talked about a return to profitability, with the situation much more optimistic vs. where we were a year ago.
Still, Delta’s recent quarterly report reminds investors of the dark reality of COVID-19, with steep losses and lots of operational headaches.
Should Delta finish lower on the day it will be its seventh consecutive daily loss.
So far - including earlier this week - the 10-week and 50-day moving averages have been support. However, these measures are being put to the test on Thursday.
If they hold and provide a bounce, bulls will have faith in this $46.50 area as a level of support, as well as these two key moving averages.
However, if this zone fails as support, a dip is quite possible.
Specifically, a break below current moving average support could send Delta down to the $44 area. There Delta stock will find the prior breakout spot, as well as the 21-week moving average.
Should a decline of that nature occur, I would expect this area to act as a bounce zone, at least upon its first test. Notice how the 21-week moving average has been decent support for several quarters now.
On the upside, there are a few levels to keep an eye on as well.
First, it would be ideal if current support held at the 50-day moving average. However, on a push higher, we need to see Delta stock reclaim its 10-day and 21-day moving averages.
If it can do that, $50 is in play, followed by the double top area near $52. Above the 78.6% retracement and Delta stock can really start to fly higher, putting that big gap-fill mark in play up at $56.87.
For now, watch the 50-day and 10-week moving averages.