.

Swing Trade Idea (CNI) – May 02, 2023

Our bearish trade for Tuesday, May 2nd is Canadian National Railway Company (CNI). CNI is part of the Industrial Sector, that has performed at -0.31% over the last week with CNI underperforming relative to its sector at -3.67% over the same period.

CNI had a sharp retracement from a lower high as it is trending lower. This was followed by a bounce higher which is now trading around a key resistance area of $120, from where we expect to see some downside movement. Both CNI and its sector has traded into an area of resistance and is slowing down, indicating that a pullback to lower levels can be expected.

As a close, if CNI were to trade above $123 for multiple days, this would invalidate our analysis and will consider cutting losses on the trade. We also will consider cutting losses on this options trade if the value of the vertical spread moves below $0.81.