Shares of Union Pacific (UNP) were trading higher Thursday as traders enthusiastic on the news that a railroad worker's strike has been averted. Unfortunately today's bullish response may not be enough to turn the charts positive.
Let's check. 
In this daily bar chart of UNP, below, we can see that prices made a strong rally from last September into a high in early April. UNP made a deep correction (more than a 2/3 pullback) into a low in July. A rebound rally into August developed but that failed and UNP turned lower once again.
Prices are trading below the 50-day and the 200-day moving averages. The On-Balance-Volume (OBV) line shows a slight rise from July. The Moving Average Convergence Divergence (MACD) oscillator is crossing the zero line for an outright sell signal.
In this weekly Japanese candlestick chart of UNP, below, we see a bearish picture. The bigger picture for UNP looks like a top formation. A neckline connecting the lows of 2021 and 2022 intersects around $210. The slope of the 40-week moving average line is negative (bearish).
The weekly OBV line shows a decline from the middle of 2021. The MACD oscillator is bearish.
In this daily Point and Figure chart of UNP, below, we can see a potential downside price target in the $197 area. A trade down to $197 would break the neckline we noted above.
In this weekly Point and Figure chart of UNP, below, we used close only price data. Here the chart shows a downside price target of $212 - close to the neckline.
Bottom line strategy: While some market observers and traders may cheer the labor settlement with the railroads, I on the other hand continue to see a top pattern unfolding on the charts. Avoid the long side of UNP.
