CSX is a $23.3 billion transportation company that provides rail-based transportation services. As we showed in our marketVISUAL this weekend, railroads are at a critical short-term support level. Therefore, we looked for an individual railroad that was also at or near key support. CSX fit the bill as its trendline, gap and price support all coincide very near the $21.61-$21.85 area. Consider entry at the current price down to gap support at $21.61. A closing stop could be very tight at the $21.40 level. We’d look for the early January high near $23.75 to be our short-term target.
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The market broke sharply last August and has subsequently recovered. However i am worried about taking a bull position for a couple of reasons. Firstly in the main the indexes are playing around in an area that may prove to be a “double top” and secondly the current recovery movements are not supported by covincing stong volume which is required according to Mr Granville.
Would be pleased to have your thoughts.