Bull & Bear: AMR Corporation (AMR)

Shares of AMR Corporation AMR are higher on the session by 2.77%, trading at $6.12. With shares spiking higher today, you have to wonder where they are heading next… Bulls: Bulls will note that the stock has begun a bottoming pattern that has lead to several break out, consolidation, break out patterns over the past week. Shares have also managed to regain the 20-day moving average, which is now upward-trending. A move above the $6.30 level could spark a large rally in the name, sparked partially fro the 17.27% short interest. Bulls will also note that oil futures have put in a recent decline, which could prove to be a double top if it continues to slide. A bullish trader could buy the June $6/7 call spread for a net debit of $0.36. Bears: Bears will note that the 50-day and 200-day moving averages are both downward-trending, which should put pressure on shares into any pop. Bears will also note that shares are trading barely above the $6.00 level, which is a highly significant support/resistance level. A return to prices below $6.00 could send bulls running for the exits, which could push the stock to new lows. Bears will also note that oil futures are sitting on 20-day historical support and have the potential to jump from here; this would be negative to shares of AMR. A bearish trader could purchase the June $6/5 put spread for $0.29. AMR Corporation, incorporated in October 1982, operates in the airline industry. The company's principal subsidiary is American Airlines, Inc. As of December 31, 2009, American provided scheduled jet service to approximately 160 destinations throughout North America, the Caribbean, Latin America, Europe and Asia. AMR Eagle Holding Corporation, a wholly owned subsidiary of AMR, owns two regional airlines, which do business as American Eagle - American Eagle Airlines, Inc. and Executive Airlines, Inc. American also contracts with an independently owned regional airline, which does business as AmericanConnection.