CapitalHubs

The predicting power of transportation sector

Long
INDEX:DTY0   None
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Important points to consider:

- Transportation sector has been widely used as leading economic activity indicator
- The correlation of Dow Jones with Dow Transportation index is high
- The divergence between both usually result in sharp rally followed by correction with same magnitude
- After last week sharp drop of the Dow Transportation index there is high probability that we are witnessing the same pattern

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Followed.
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There is an article at seekingalpha this weekend that outlines that the Dow does best after a period when there is a divergence in the Transports. See what you think.
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Find it consistent with my findings. Recall: "The divergence between both usually result in sharp rally followed by correction with same magnitude". This is not my opinion but what happened previous two times.
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Agreed.
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Agreed.
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Followed.
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Followed.
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Agreed.
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Agreed.
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