Todays Big Stock: Fedex (NYSE: FDX)

FedEx Corp, the world’s second-largest package delivery company, released its fiscal 4th quarter earnings on Wednesday before the open. FedEx earnings increased 33% on stronger demand and being able to pass higher fuel costs on to its customers.

FedEx earned $558 million, or $1.75 per share, which compares with $419 million, or $1.33 per share, in the same period last year. Revenue increased 12 percent to $10.55 billion. Analysts had expected earnings of $1.73 per share on revenue of $10.4 billion. For the full year, FedEx earned $1.45 billion, or $4.57 per share, compared with $1.18 billion, or $3.76 per share, for fiscal 2010

FedEx is considered a bellwether of global economic health among analysts and economists because it ships a wide variety of goods. Its business reflects the ups and downs of business and consumer spending. Wall Street has so far applauded the release with FDX share being up 2% in pre-market trading.

Below is a 1 yr. chart of FDX (FedEX Corp) with my added notations:

FDX has two important price levels to watch for potential trading entries. The $90 level has been and important area of both resistance and support for FDX throughout the last 9 months. During the same period of time, $85 has been a strong level of support.

The Tale of the Tape: FDX has released its 4th quarter earnings report. The $85 and $90 levels are the prices to watch. Depending on your view, and market position, a short position could be entered on a rally up to $90 OR on a break below $85, while a long position could be entered at $85 OR on a breakout above $90.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade.  Capital preservation is always key!

Good luck!
Christian Tharp, CMT