ETFs Series Solutions US Global JETS ETF (JETS) analysis: price news for March
The number of passengers that move through TSA have improved month over month in February despite the restrictions
The US Global ETF JETS reflects the returns of several of the US global airlines. Airlines were hammered during the beginning of the pandemic and are still struggling to make money. Many have reduced their expenses by cutting the number of planes they fly. Passengers are under tight restrictions and have to provide the airlines with negative Covid-19 tests if they plan to fly internationally.
The technicals look positive as the JETS ETF rebounds in February.
Restrictions are harsh but TSA numbers are better
The US Center for Disease Control has issued restrictions on air travel in 2021. If you plan to travel internationally, you will need to get tested no more than three days before you travel by air into the United States and show your negative result to the airline before you board your flight.
Despite the restriction, the number of passengers that are moving through TSA checkpoints has increased during 2021. In early January the total was approximately 33 per cent of the volume that moved through TSA in 2020. As of the third week of February, the volume that moved through TSA checkpoints was down 50 per cent compared to the prior year.
Earnings are better than expected
US airlines did not perform well in Q4 but many posted financial results that were better than expected. US airlines lost a combined $34bn in 2020. CEOs of the major airlines have repeatedly called the period the most difficult in the carriers’ history. In several cases such as American Airlines, the losses were not as bad as expected. American posted a net loss of $2.2bn for the fourth quarter. Its revenues tumbled more than 64 per cent to $4.03bn, compared with $11.3bn a year earlier. Sales were above analysts’ forecasts for $3.88bn for the quarter.
ETFs Series Solutions US Global JETS ETF technical analysis
In the third week of February, the JETS ETF closed at an 11-month high. Resistance is seen near the 2020 highs at 31.93. Support on the JETS is seen near the 10-week moving average at 23. The 10-week moving average crossed above the 50-week moving average in December which means that a medium-term uptrend is now in place. Short-term momentum is positive as the fast stochastic recently generated a buy signal, but prices are overbought. The current reading on the fast stochastic is 92, above the overbought trigger level of 80, which could foreshadow a correction. The relative strength index (RSI) broke out which reflects accelerating positive momentum. The RSI nearly reflects an overbought condition. The current reading on the RSI is 69, just below the overbought trigger level of 70. Medium-term momentum is positive as the moving average convergence divergence (MACD) histogram is printing in positive territory with an upward sloping trajectory which points to higher prices.
JETS ETF: how to trade?
The JETS ETF is rebounding and poised to test the 2020 highs. Air travel is rebounding despite restrictions on travel. Financial results are coming out better than expected, which is a positive sign. The trend is upward sloping and despite some short-term overbought conditions, momentum remains positive. Look for the index to continue to rise in March.