This week, our Top Pick of the Week (TPOW) strategy focused on American Airlines (AAL). We purchased AAL at the market open on Monday, January 27, 2025, at $16.80. By the close of trading on Friday, January 31, 2025, we exited at $16.92, securing a small gain.
AAL had a strong start to the week, rising approximately 4% at one point. However, the stock faced downward pressure following the tragic crash of an American Airlines plane involving a collision with a military helicopter. This unfortunate event likely impacted investor sentiment and contributed to AAL’s pullback.
The broader market, represented by SPY, also faced declines, closing the week at $601.79, down from the prior week.
Key Takeaways:
- Market Sensitivity: Unexpected events, such as the AAL crash, can significantly affect stock prices.
- Taking Profits: AAL was up nearly 4% earlier in the week—a reminder that setting sell limits can help lock in gains.
- Compounding Matters: A consistent 3% to 4% weekly return can lead to substantial annual gains, reinforcing the importance of disciplined trading.
As always, use judgment and discipline when setting sell targets and managing risk. Staying consistent with high-probability setups is the key to long-term success.
