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PreMarket Prep Recap: Coronavirus Concerns Resurface, American Airlines Turbulent

With the coronavirus back in the news and a few notable earnings reports, there were plenty of issues to cover on Thursday's PreMarket Prep Show.

Benzinga · 01/23/2020 16:14

With the coronavirus back in the news and a few notable earnings reports, there were plenty of issues to cover on Thursday's PreMarket Prep Show.

Coronavirus Matters Again

Tuesday's small decline in the market was attributed to the outbreak of the coronavirus in China, but was shrugged off Wednesday as many of the major indexes made new all-time intra-day highs. However, much of those gains eroded by the close.

Once again, the spread of the virus is back in the headlines and exerting selling pressure on the markets. The co-hosts of the show were expecting more selling early in the session, but noted whatever the decline the market may have today, it's hard to declare the great bull run has ended. After a steep decline off the open, the index's have found intra-day support and are attempting to rebound.

Lakeland Industries Moving Off Coronavirus News, Again

At the top of the show, a list was given of several issues in the crosshairs of the virus outbreak. The only one discussed from a technical perspective was hazmat suit maker Lakeland Industries (NASDAQ: LAKE), which has been one of the main beneficiaries of the unfortunate event.

After ending Friday's session at $10.97, it reached $15.40 on Tuesday but was unable to hold that elevated level. As the fear subsided Wednesday, the issue retreated from Tuesday's close of $13.77 to $12.18, settling near the lows for the session.

The roller coaster continues on Thursday. Co-host Dennis Dick has no interest in the issue from a longer-term perspective as he suspects once the virus is out of the news, the issue will return to the area the rally emanated from.

From a shorter-term technical perspective, the author of the article opined that $12 support level is a critical level for the issue to hold to keep the really in tact. The reason being there are a pair of lows from Tuesday ($12.15) and Wednesday ($12.01) that if breached may fall into an area of limited support.

On the upside, a close above Tuesday's ($13.77) may attract more buyers into the issue. As of 10:15 a.m. EST, neither of those levels has come into play as $12.75 stands as the low and $13.50 stands as the high for the session.

American Airlines Trading Volatile After Q4 Miss, Travel Concerns

Before the open, American Airlines (NASDAQ: AAL) reported an EPS beat with a slight sales miss. The issue was in the green when it was being discussed on the show as the market was comfortable with its full-year guidance.

Since the issue has been in a continuous downturn since late 2017, the hosts were hands off on the buy-side. From a technical perspective, the $28 area was identified as a key resistance area for today's session and beyond. The reason being, its last two session highs were just under that level and its pre-market high was at the area as well.

After a flat open, sellers engulfed the issue taking it to $26.04, which was its lowest level since last October. So far, the rebound off that has not yet reached the resistance the aforementioned resistance as $27.66 stands as the high for the day as of 10:45 a.m. EST.

Marc Chaikin Joins The Show

Early in the broadcast, Marc Chaikin, the founder of Chaikin Analytics joined the broadcast. Despite the red on the screen, Marc was not wavering from his extremely bullish stance and foresees much higher prices across the board soon.

At 8:35 a.m. EST on Friday, Evan Schnidman, founder and CEO of Prattle will discuss what his text analytics company for central banks and individual company's are revealing.