Recession Tell:

The big delivery service plays have always been watched to give clues on the possibility of recession. In years past FDX was considered a better economic read than UPS, then UPS was the better actor as seen here between 2018-2023 on the MONTHLY ratio chart. Since Q4 ’22 FDX has again taken charge and for that reason it is the better way to gauge strength. The daily chart below shows it still well above its 50 and 200 day SMAs, something UPS can not say. Another good way to compare stocks against each other is by how far they are trading from their most recent 52 week highs. FDX is “just” 9% from its annual peak, while UPS is more than 3 times that at 28%. On a YTD basis FDX is higher by 5%, as UPS is lower by 9%. If FDX were to lose the 253 level that in my mind would be a big negative for the economy and overall market. The MONTHLY chart of FDX looks healthy as it retreats into a retest of a double bottom with handle breakout in a pattern 3 years long. I think this name will see the very round 300 number where it was rejected in June 2021, by the end of 2024.

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