Stock Chart ODFL

Posted by downtowntrader | 8/06/2008 08:27:00 PM | 3 comments »

Stock Chart Analysis ODFL

Old Dominion Freight Line (Public, NASDAQ:ODFL)

Often I look to intermarket relationships to look at underlying market themes that can help skew the odds in my favor on a given trade. Lately, commodities and oil in particular have been taking it on the chin and with the dollar breaking some resistance, it looks like it could rally some more in the next few weeks. Transport stocks have benefited directly from the drop in crude as Airlines, trucking, and rails have looked quite bullish over the past few sessions.

Below is a chart of ODFL with the price of crude as tracked by USO overlayed on the chart. Notice how ODFL was basing the entire time crude was in an uptrend and how ODFL would tend to rise on pullbacks in oil and fall back when oil would rise. Then notice how ODFL had a significant breakout at a time when oil was breaking down below a multi month trend line. Volume was substantially higher on the breakout and ODFL has been basing in a flag type formation since the initial breakout. While it may come back and retest the lower boundary of the flag again, it sure looks like ODFL is setting up for a sharp move higher. I also like that the all time high is just about 10% higher. It sure looks like this is a good sector to be in moving forward.

Good Trading,


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  1. Guru // 10:24 PM  
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  2. James // 11:40 PM  

    I think that we are going to see oil head higher over the long term, but if it continues to moderate in the short-term the transports could be good trades.

    We interview some of the best in the business--Jim Rogers, Peter Schiff and more. The consensus seems to be that commodities rebound.

  3. downtowntrader // 9:45 PM  

    I can't disagree with you on the long term picture for oil. Commodities are in a secular bull market and it may still be in the early stages. However, all markets move in cycles, and there are hints that commodities are in an intermediate topping phase. Of course we won't know until after the fact which is the fun part.
    Thanks for the comments,