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FedEx may stand "head and shoulders" above the rest

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Shares of FedEx (NYSE:FDX) $56.70 +1.52% are trading strong today and hint that yesterday's market monitor comments about the recently triggered "reverse head and shoulders" pattern from the bar chart may have the stock standing head and shoulders above many bullish trades a trader could be implementing.

My more "bullish" stance on FedEx (FDX) isn't "anything new" as this is a stock I've mentioned as bullish in recent months. The point and figure chart has been bullish since November of last year and has been "hinting" at the $83 level from its bullish vertical count.

Now bar chartists perhaps have a "reason" to be looking at the stock from the bullish side with the recent breaking of a neckline in the reverse head and shoulders pattern.

FedEx Chart - Daily Interval

FedEx's (FDX) recent break above the $56 level is bullish. Not only did the stock break a level of horizontal resistance on its bar chart, but its point and figure chart also generated a "buy signal" at that level.

FedEx (FDX) is a component of the Dow Transportation Average (TRAN) 2,709.59 +0.10. As discussed in past months, this is a sector of the MARKET that has performed bullish RELATIVE to the broader market averages. In recent weeks we've been monitoring the TRAN as it battles with a rounding lower 50-day MA. Traders/investors should be making the tie that FDX is a LEADING stock in the group. For greater probability of bullishness, a bull in FDX would sure like to see the TRAN break above its 50- day MA and act like a "tidal wave of enthusiasm" or bullishness to propel the stock higher.

As mentioned in the past. FDX's point and figure chart is bullish with a vertical count of $83. This at least gives the trader some observation of potential longer-term bullishness to combine with the recent developments in the bar chart.

The "3 stocks" I follow in the "package shipping" area are Airborne Freight (ABF) $20.92 -0.57%, FedEx (FDX) and United parcel Services (UPS) $62.63 +0.56%.

As noted in past commentary, UPS is currently in labor talks with its employees labor union, thus I'm more tempted to stay away from the stock until these issues are settled as it becomes an uncertainty I would just soon avoid.

Jeff Bailey
Senior Market Technician
Option Investor

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