3 Transport Stocks Ready to Roll

12/22/2011 10:15 am EST

Focus: STOCKS

Despite higher oil prices, Greg Harmon of Dragonfly Capital picks three trucking companies that have room to run.

Despite higher levels for oil, trucking company stock prices are looking up. No, really! Let’s take a look at three that are primed to move higher: J.B. Hunt Transport Services (JBHT), Knight Transportation (KNX), and Old Dominion Freight Lines (ODFL).

J.B. Hunt Transport Services (JBHT) had a large run up from the September lows and then paused and pulled back in early December. After finding support near the 50- and 200-day simple moving averages (SMAs) and previous consolidation through October into November, it is rising again.

It has a bullish Relative Strength Index (RSI), a Moving Average Convergence Divergence (MACD) indicator that is about to cross positive, and the 50-day SMA is about to make bullish golden cross up through the 200-day SMA. The measured move (MM) in the stock would take it to $48 first, near the July highs, and then $54.

See related: Golden Cross: Reliable in Any Market

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Knight Transportation (KNX) had a similar pattern, rising from October lows only to pull back and then work higher again. It is now moving to test resistance at the $15.68 area with a bullish RSI that is trying to rise and a MACD that is about to cross bullishly positive.

The 50-day SMA has crossed the 100-day SMA but still has some work to reach the 200-day SMA for that golden cross. It is poised to move higher, and through that resistance, has nearly 42% of upside before resistance.

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Old Dominion Freight Lines (ODFL) is another with that rise off of the October lows and then a pullback and second rise. This company is already breaking into new highs over $40, and with an RSI that is bullish and rising, a MACD crossing positive, and having already printed a golden cross, it has a tailwind moving higher to a measured move at $43.

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Time to get truckin’!

By Greg Harmon of Dragonfly Capital

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