Buffett Should Be Concerned About Berkshire And UNP Here

Is Berkshire Hathaway (BRK-A) and Union Pacific (UNP) a good proxy for the broad markets and economy? If you happen to believe they are, what happens to both of them from here, should be very important!

BRK and UNP both hit highs before the broad market did, earlier this year. Did they lead the market lower? Time will tell. Of late while the S&P 500 has rallied back near all-time highs, neither of these stocks has been able to match the broad markets upward strength.

The decline in BRK took it below its 4-year rising channel and the decline in UNP put it back inside of its 30-year rising channel.

Now BRK is kissing the underside of the 4-year rising channel as resistance for the first time ever at (1), which now could become a very important underside kiss.

UNP is now back inside of its 30-year rising channel and is kissing the underside of this long-term channel for the first time since the early 1990’s.

Are these two stocks/companies leading indicators of things to come? Whether they are leading indicators, is not what is important to the Power of the Pattern at this time. What is important is this…both are testing the underside of multi-year resistance lines at this time.

What they do at these resistance lines, should be very important for where these companies are 6-months from now!