Transports in the Crosshairs

J.B. Hunt Transportation Services Source: eSignal

You'd think truckers would look as appetizing as the railroad or packaging stocks these days, but that isn't the case. Top names in the group, including J.B. Hunt Transportation Services(JBHT) and Arkansas Best(ABFS), have actually sold off in the last week, despite the big rally. This points to cash getting freed up for purchases in other subsectors.

No, I wouldn't sell short the trucking stocks because they're in better technical shape now than earlier this year, but I would avoid them at all costs. It's a clear warning when a major group fails to participate in a broad market upswing. Frankly, I don't know the reasons for group weakness but the price action is speaking for itself.

Shipping stocks have stopped falling in recent months after the near collapse in the world economy brought many of these companies close to bankruptcy. However, buying interest remains scattered across the sector, with a handful of components perking up while the majority just runs in place.

Teekey LNG Partners (TGG) Source: eSignal

Teekey LNG Partners(TGG), not to be confused with the larger Teekay(TK), is a shipping leader that now trades at a 10-month high. It bottomed out above $9 following a horrendous selloff that started in the mid-$30. The stock started to move higher in November and stalled at the 200-day moving average about two months later.

It finally broke out above this level last week. This positive action sets the stage for a continued uptrend that could reach the upper $20s in coming weeks. Any pullback toward support at $20 should mark a low risk buying opportunity, so get this one onto your watch list as soon as possible.

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Alan Farley provides daily stock picks and commentary with his "Daily Swing Trade" newsletter.

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