American Airlines (AAL) has shown strong upward movement since the low on April 4. A 100% Fibonacci extension points to a target price of $16.8. This positive trend is supported by an Elliott Wave zigzag pattern hanging from the low on September 30. From that low, wave A peaked at 14.05, then wave B pulled back to 12.11. Currently, wave C is advancing in a sharp Elliott Wave pattern. Within this, wave (i) ended at 12.65, while wave (ii) dropped to 12.15. Wave (iii) rose to 14.11 before wave (iv) pulled back to 13.56. Wave (v) is about to finish, marking the end of wave ((i)). A corrective wave ((ii)) is expected next, focusing on the trend since the projected low on November 18, 2025. As long as the pivot at 12.11 holds, any pullbacks should find support within swing structures at 3, 7, or 11. This technical outlook suggests that further upward movement is likely. American Airlines (AAL) appears bullish, showing an upward trend that began earlier this year in April. Analysts suggest a target price of $16.8, indicating any upcoming pullbacks are likely to be temporary dips in a larger upward movement. This strength is also backed by recent industry reports, which show a notable rise in holiday travel demand. In the first week of December 2025, TSA passenger numbers rose by 6% compared to last year, exceeding earlier predictions. Additionally, jet fuel prices have dropped over 10% since their peak in October 2025, reducing cost pressures and improving profit potential for the airline this quarter. Traders looking to take advantage of this upward trend can buy February 2026 call options with strike prices of $15 or $16. This strategy provides potentially higher returns if the stock continues to rise as expected, while also allowing time for the current impulse wave to complete. A more cautious approach would be to sell out-of-the-money put credit spreads based on recent price trends. For example, selling a January 2026 $13 put while purchasing a $12.50 put for protection could generate income. This trade remains profitable as long as AAL stays above the short strike price by expiration. We should prepare for a corrective pullback, wave ((ii)), following the current upward movement. This pullback could offer a better entry point for long-term bullish positions. Short-term traders might consider taking profits on initial positions and then re-entering during the dip. All bullish strategies should monitor the November low of $12.11 as a key risk management point. If the price drops below this level, it would invalidate the immediate bullish outlook, signaling a need to cut losses on any long positions.

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