Trucking Stock J.B. Hunt Looks Like It Wants to Travel Lower

The company is set to report earnings after the close Tuesday.

Shares of trucking and logistics company J.B. Hunt Transportation Services Inc. (JBHT) are looking vulnerable ahead of its earnings report after the close of trading Tuesday. Let's check out the charts and indicators. 

The charts of JBHT looked positive back on July 9 where we recommended, "Traders could approach JBHT from the long side risking a close below $118. The $147 area is our first upside price target." Prices reached our $147 target and our $169 weekly Point and Figure target.

With the shares now trading around $200 a change in strategy is needed. 

In the daily bar chart of JBHT, below, we can see that the shares are testing the cresting 50-day moving average line. The rising 200-day moving average line intersects down around $179.

The daily On-Balance-Volume (OBV) has been struggling and rolling over as prices pushed higher into the end of December. This is a bearish divergence as the bullish price action did not get confirmation from the OBV line.

The Moving Average Convergence Divergence (MACD) oscillator is pointed down and tells us that the "trend strength" has been weakening. 

 

In the weekly Japanese candlestick chart of JBHT, below, we can see some bearish divergences. Prices are still in an uptrend above the 40-week moving average line but this is a lagging indicator.

 

The weekly OBV line has been stalled the past four months even as prices made new highs -- a bearish divergence. The MACD oscillator made a lower high than in May for a bearish divergence and is close to a downside crossover. 

 

 

 

In this daily Point and Figure chart of JBHT, below, we can see a potential upside price target but a trade at $191.64 could start to weaken the picture. 

 

 

 

Bottom-line strategy: I have no special knowledge of what JBHT could report for earnings, but the indicators suggest that we could see weakness in the days and weeks ahead. I would nail down profits on longs ahead of the close Tuesday.

 

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