Air China (00753.HK) Short-term Analysis: Significant Rebound at the 5 Yuan Level, Oversold Bottoming to Challenge Resistance
Air China (00753.HK) Short-term Analysis: Significant Rebound at the 5 Yuan Level, Oversold Bottoming to Challenge Resistance
Air China (00753.HK) has experienced significant stock price fluctuations recently. After a notable pullback from late March to early April, it rebounded strongly on April 8. As of April 8, 2026, Air China closed at 5.04 yuan (intraday high reached 5.28 yuan with gains exceeding 9% during the morning session), showing a significant recovery from the previous closing price of 4.8 yuan. The stock had been declining from around 5.8 yuan in early March, hitting a low near 4.5 yuan before finding support at the 4.8 yuan level. On April 8, positive news spurred a sector-wide rally in the aviation industry.
Technical Analysis
From a technical chart perspective, Air China's share price has been in a downtrend since mid-March, hitting a low near 4.5 yuan. Based on technical data as of April 2, the first support level for Air China is approximately 4.5 yuan, which represents the bottom area of the short-term downtrend channel. A more critical second support level lies at 4.13 yuan, representing the key low support zone since the beginning of the year. In terms of resistance levels, the first resistance is at 5.29 yuan, corresponding to the 10-day moving average. If it breaks through, the next resistance will be seen at 6.07 yuan, coinciding with the 60-day moving average and the top of the previous consolidation range. Overall, current technical signals suggest an 'oversold bottoming rebound' pattern, implying potential for further short-term recovery, but attention should be paid to the pressure at the 5.29 yuan resistance level.
In terms of institutional views, there is considerable divergence among brokerages regarding Air China’s rating. Morgan Stanley is optimistic about the airline industry's upcycle, raising its target price for Air China's H shares from 8.11 yuan to 10 yuan, with a 'Buy' rating. Huatai Financial Holdings also gives a 'Buy' rating with a target price of 9.2 yuan. Bank of America Securities has raised its target price to 8.3 yuan. However, UBS Group maintains a 'Sell' rating with a target price of only 3.3 yuan, noting that revenue rose 3% year-over-year last year but recorded a net loss of 1.77 billion yuan, including a net loss of 3.6 billion yuan in Q4 alone. Across five brokerage reports, Air China has an average rating of 2.8, evenly split between Buy and Sell ratings, reflecting clear market divergence over its future outlook.
Latest sector share prices (as of the morning session on April 8, 2026)
The aviation sector surged across the board today:
Warrant product recommendations and comparisons
Currently, Air China's stock price is at the 5.25 yuan level, with support levels at 4.5 yuan and 4.13 yuan, and resistance levels at 5.29 yuan and 6.07 yuan. Investors can choose suitable products based on their own views. All current market warrant products are call warrants, reflecting a relatively bullish sentiment.
Below is a detailed comparison of the terms for Air China's call warrants:
J.P. Morgan Call Warrant for Air China (code 26802), latest price 0.067 yuan, daily increase of 19.64%, strike price 7.690 yuan, approximately 51.98% out-of-the-money, effective leverage 4.14 times, premium 58.60%, expiration date November 23, 2026, implied volatility 62.274%, conversion ratio 5.00, street leverage 0.00%. The key advantage of this product is its zero street leverage, indicating that market chips are highly concentrated in the hands of the issuer, ensuring higher price stability.
The UBS Group call warrant for Air China (code 26919), latest price at 0.067 yuan, single-day increase of 17.54%, strike price at 7.690 yuan, also in a 51.98% out-of-the-money state, effective leverage at 4.14 times, premium at 58.60%, with the same expiration date and implied volatility as Morgan Stanley products, zero street ratio. This product has similar terms to Morgan Stanley’s product; UBS Group has a solid reputation in the derivatives market, making it suitable for investors who prefer the UBS brand.
The Citi call warrant for Air China (code 26974), latest price at 0.061 yuan, single-day increase of 17.31%, strike price at 7.690 yuan, in a 51.98% out-of-the-money state, with the highest effective leverage at 4.31 times among the four products, lowest premium at 58.00%, expiry date on November 23, 2026, implied volatility at 60.005%, conversion ratio at 5.00, and a street ratio of 1.81%. This product performs best in terms of leverage efficiency and cost control, with the highest effective leverage and lowest premium, making it ideal for aggressive investors seeking maximum leverage effect.
The Credit Suisse call warrant for Air China (code 26581), latest price at 0.069 yuan, single-day increase of 18.97%, strike price at 7.680 yuan, in a 51.78% out-of-the-money state, effective leverage at 4.09 times, premium at 58.60%, expiry date on November 30, 2026, implied volatility at 61.988%, conversion ratio at 5.00, and a street ratio of 0.06%. This product has a slightly longer expiry date (seven additional days), resulting in slower time decay, making it suitable for investors expecting to hold the position for a longer period.
Two selected bullish products:
- Citi call warrant (26974) $CTAIRCN@EC2611A.C (26974.HK)$ : Effective leverage at 4.31 times is the highest among the four products, with the lowest premium at 58.00%; it shows the best performance in terms of leverage efficiency and cost control, making it suitable for aggressive short-term investors betting on a rebound.
- Credit Suisse call warrant (26581) $CIAIRCN@EC2611A.C (26581.HK)$ : Effective leverage at 4.09 times, longer expiry date (November 30), street ratio at only 0.06%, balanced terms, making it suitable for investors expecting to hold the position for a longer period.
On the bearish side, there are currently no put warrants or bear contracts related to Air China in the market. Investors who are bearish may consider using index derivatives or waiting for relevant products to be listed.
Overall, Air China's share price is currently in a strong rebound phase after an oversold bottoming-out, successfully reclaiming the 5-yuan level, and the resistance at 5.29 yuan will determine the short-term trend. Fundamentally, positive factors such as easing tensions in the Middle East leading to a sharp drop in oil prices, an increase in fuel surcharges, and strong travel demand during the Qingming Festival are concentrated, but divergence in institutional ratings and fundamental pressures like expected losses in 2025 still need attention. Investors should strictly manage risk when deploying, choosing appropriate call warrants based on key support levels at 4.5 yuan and 4.13 yuan, resistance levels at 5.29 yuan and 6.07 yuan, while being mindful of the sensitivity of deep out-of-the-money call warrants to underlying stock price increases.
Interactive Q&A:
Dear readers, do you think Air China (00753) can hold above the 5.29 yuan resistance level in the short term?
A) Yes, benefiting from the sharp drop in oil prices and the collective surge in the aviation sector, further challenging the 6.07 level
B) No, resistance at 5.29 is heavy, a retest of the 4.5 support level is needed to confirm the bottom
C) Range-bound fluctuations between 4.8 and 5.29
Feel free to share your views in the comment section!
In your opinion, when choosing call warrants for airline stocks, how do you balance effective leverage and premium levels? Citi 26974 has the highest leverage and lowest premium, while warrant 26581 from another issuer has a longer expiration date. Which one would you prioritize? Feel free to share your experience!
Reminder: This article does not constitute any investment advice.
This article is for reference only and does not constitute any investment advice. The market data, opinions, and analysis contained herein may change at any time without prior notice. We are not responsible for any loss or damage caused by reliance on the information in this article. Technical analysis only shows whether certain technical conditions are met; a comprehensive assessment of asset performance should combine other data and should not solely rely on this article to make trading decisions. Please note that past performance is not indicative of future results. Follow Jenny's insights on Hong Kong stock warrants for more professional analysis.
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Risk Disclaimer: The above content only represents the author's view. It does not represent any position or investment advice of Futu. Futu makes no representation or warranty.Read more
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