A First Class Setup

Airline stock AAL is getting whacked into a broad market rally today on the back of a Goldman Sachs downgrade, not to mention American and Rolls-Royce dissolving a partnership yesterday. 

But beyond that, American is at a critical juncture on a multi-year basis, after airlines have staged a shocking rally in recent years considering how hated of a sector they have been. 

On the weekly chart, below, note the Bollinger Bands pinched in, indicative of a big move coming. Also note the potential major top forming. 

In the coming weeks, I am looking at the airlines into bounces, especially AAL, as representing quality short entries. Also keep an eye on JBLU and its steep long-term uptrend.