Market Minute: FedEx At Crucial Support Heading Into Postmarket Earnings
FedEx’s (FDX) stock price sits at the edge of knife as the shipping and transportation company is poised to release its quarterly earnings statement this afternoon after a bruising four-month decline sent shares falling about -20% off the Nov. 25 highs. Shares of FDX last week hit 239.50, the lowest level since Feb. 2024, but now have rallied back above a key area that recently was breached; a general supportive zone of old lows from May and June of 2024 near 244. Generally speaking, this type of situation in which price is near a key support level coupled a major potential catalyst like earnings looming is where potential breakouts can develop if those extreme lows get breached.
From a technical perspective, price sits below most major moving averages, with faster moving averages continuing to diverge from the slower ones which is suggestive that the trend is continuing to the downside. The bigger picture also looks precarious for bullish traders. A five-year weekly chart shows that price last week closed below this longer-term Volume Profile Point of Control (area of heaviest trading) near 254 amid a broader downtrend. Momentum also remains bearish with the RSI experiencing a matching downtrend with price that has brought it below the 50 midline.
In terms of potential support, the yearly -2 Standard Deviation Channel study comes in near 238, so this could be a potential foothold if the recent lows are broken. Failing that, the next major volume node on the five-year chart comes in near 228. If earnings provide an upside pop, the short-term 21-day Exponential Moving Average could be one upside area to watch near 251. After that, the -1 Standard Deviation Channel roughly coincides with the downward trendline beginning with the Nov. 25 highs near 252.
Friday’s Mar. 21 quadruple witching expiration is the most active series in terms of open interest for FedEx with 58,404 total contacts showing a put/call ratio of 0.72. The 220 strike is the top O.I. for both the calls and puts, but notable activity closer to current prices can be found at the 240 and 250 strikes on both sides.
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