A positive earnings report and the announcement that Canadian National Railway’s (CNR.TO) embattled CEO is retiring by January has sparked renewed interest in the railroad’s shares. Yesterday they climbed 6 positions within the Yellow Neutral Zone of the SIA S&P/TSX 60 Index Report, finishing in 22nd place and snapped out of a recent relative strength downtrend.
A very bullish technical setup has emerged in Canadian National Railway (CNR.TO) shares. Back in September, the shares ended a consolidation phase with a breakout over the top of a $124.00 to $146.00 trading range. An initial rally ran out of gas near $160.00 and the shares fell back in a normal trading correction. This correction was contained by the 50-day moving average near $144.00, and since then, accumulation has resumed. Yesterday, the shares surged upward, starting off with a bullish breakaway gap to the upside, then blasting through $160.00 to a new all-time high, signaling the start of a new advance.
Based on measured moves from recent trading ranges, next potential upside resistance may appear near $168.00, $175.00, and $190.00, then the $200.00 round number. Initial support appears near $154.00, the bottom of yesterday’s gap.
For over a decade, Canadian National Railway (CNR.TO) shares have been steadily advancing in a step pattern of rallies followed by consolidation pauses at consistently higher levels. Back in September, the shares completed a bullish Triple Top breakout which ended an eleven-month consolidation phase. Yesterday, the shares broke out to a new all-time high, completing a bullish Double Top breakout, ending a brief correction and confirming the start of a new rally phase
Vertical and horizontal counts suggest potential upside resistance tests near $170.40, $191.90, and $207.70 on trend, along with the $200.00 round number. Initial support appears between $148.35 based on a 3-box reversal, and the $150.00 round number.
With a bullish SMAX score of 8, CNR.TO is exhibiting strength against the asset classes.
Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.