The transportation services industry group was strong yesterday. Several of these candidates look bullish and ready for follow through. If the transportation sector continues, look for these stocks to push higher. Airlines were less interesting, compared to rails, truckers and marine bulk shipping stocks.
RLGT is at the top of the list for good reason. It sports an 85 composite rating, which means it is outperforming 85% of the stocks in its industry group.
Note that each time the stock based over the past eight months, a breakout was preceded by a 10ee/STO/MACD setup. We see the same thing now, as prices pushed higher and MACD cross confirmed the change in bullish momentum. RSI and Stochastic rose together. The same thing is happening now, though we do acknowledge that this is a third-stage base. Therefore, take a smaller position compared to earlier breakouts, as statistics show we are more apt to produce a smaller push this time.
If the sector continues to show strength, RLGT could run anyway. Despite the third-stage base, the stock is technically very strong, along with its competitors. EPS is 5/15/2017.
XPO is ranked #1 in the transportation service group, by Investors Business Daily standards and a composite rating of 86. As you can see, RLGT is following the same wave of momentum. RSI, MACD cross and stochastic rising, similar to RLGT, or is it the other way round? XPO reports earnings 5/3/2017.
In addition to this group, we also have bullish setups in marine transports. These stocks are pushing higher as the Baltic Dry Index breaks out of a 10 year downtrend.
We have a position in SBLK and SALT as well. Star Bulk is an income trade and one we will likely roll up and out, if the strength persists.
No matter what you are trading today, we need to monitor Junk (JNK), High Yield Corporate Debt (HYG) and Crude (CL/WTIC). As long as they are pushing higher, we are short term and long term bullish. We are long term bullish due to everything covered in the weekend video news letter, including the Bond Stock Ratio (UST:SPX) and breadth.
Barring any unforeseen news, we should see higher prices as “risk on” continues to rule the market performance short and medium term.
Have a great day,
Vinny
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