The transports are a closely watched group as they are a good barometer of economic health, as good purchased need to obviously be driven, flown or shipped places. I am monitoring the IYT overall and came away impressed last week how the ETF overcame a bearish engulfing candle on 5/22. It is on its first 3 week winning streak since the weeks ending 11/24-12/8/17 gaining more than 5% and all three weeks CLOSED at the top of their weekly range. Volume was soft but this action came as crude prices were going higher, of course until the end of last week. Below we take a look at a best in breed rail play CNI, first how it was presented in our Tuesday 5/1 Game Plan and then we take a present look.

Rails showing decent charts include CSX and CP, both off just 2 and 3% from there most recent 52 week highs. CNI is a Canadian transport play lower by 6% YTD and higher by 7% over the last one year period and sports a dividend yield of 1.8%. Earnings have been very negatively consistent with FIVE consecutive losses of .7, 1, 2, 1.9 and 3.4% on 4/24, 1/24, 10/25, 7/26 and 4/25/17. The stock is on a current 5 week winning streak which has risen more then 10%, but was immediately preceded bu a 9 of 11 week losing streak the weeks ending between 1/12-3/23 and now sits 9% off most recent 52 week highs. Enter CNI on a buy stop above its 200 day SMA at 78.75.

Trigger CNI 78.75.  Stop 76.25.

Taking a current view CNI the stock is now higher 8 of the last 9 weeks, with the lone lower week ending 5/4 losing just 5 pennies. It has gradually built the right side of its cup base, more success prone, and now sits just 2% off its most recent all time highs. Some may see a handle on the cup base but it is trading sideways, which has created a bull flag pattern.

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The transports are a closely watched group as they are a good barometer of economic health, as good purchased need to obviously be driven, flown or shipped places. I am monitoring the IYT overall and came away impressed last week how the ETF overcame a bearish engulfing candle on 5/22. It is on its first 3 week winning streak since the weeks ending 11/24-12/8/17 gaining more than 5% and all three weeks CLOSED at the top of their weekly range. Volume was soft but this action came as crude prices were going higher, of course until the end of last week. Below we take a look at a best in breed rail play CNI, first how it was presented in our Tuesday 5/1 Game Plan and then we take a present look.

Rails showing decent charts include CSX and CP, both off just 2 and 3% from there most recent 52 week highs. CNI is a Canadian transport play lower by 6% YTD and higher by 7% over the last one year period and sports a dividend yield of 1.8%. Earnings have been very negatively consistent with FIVE consecutive losses of .7, 1, 2, 1.9 and 3.4% on 4/24, 1/24, 10/25, 7/26 and 4/25/17. The stock is on a current 5 week winning streak which has risen more then 10%, but was immediately preceded bu a 9 of 11 week losing streak the weeks ending between 1/12-3/23 and now sits 9% off most recent 52 week highs. Enter CNI on a buy stop above its 200 day SMA at 78.75.

Trigger CNI 78.75.  Stop 76.25.

Taking a current view CNI the stock is now higher 8 of the last 9 weeks, with the lone lower week ending 5/4 losing just 5 pennies. It has gradually built the right side of its cup base, more success prone, and now sits just 2% off its most recent all time highs. Some may see a handle on the cup base but it is trading sideways, which has created a bull flag pattern.

If you liked what you read why not visit www.chartsmarter.com.