Going LONG or SHORT in Rail Companies? Series I: CSX

I will be writing another series on Long & Short Investment covering Rail companies.  Generally, there could be some sell-off occurring in these Rail companies.  If we add these Rail companies to our portfolio at a right time, we could make some profit from them.  

Last week, CSX Corporation declined more than 6% after the their 4th quarter earnings.   This drop definitely gives us some insight on which direction CSX is headed near future.  Looking at the technical analysis on a 9 months chart, there was a break out on the resistance level at $48 and tried to move up higher.  However, the upward support line was broken after the earnings news last week and CSX continued to decline, eventually braking the $48 support level.  Now, it is clear that CSX is headed towards $41.50, the next support level.  It should present a great buying opportunity to take LONG position on CSX at this support level.

I will apply similar technical analysis on Norfolk Southern Corporation in the next Going LONG or SHORT in Rail Companies series.

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