The reason for this is because transports are a good indication of economic health. Lower patronage and goods moving means lower economic activity.
A few notes about the chart.
The orange line is the DJ30.
1. Looking at the first green flag in December we can see the start of the diverging indices that were previously highly correlated. The Transports drops off heavily in early December with the DJ30 following soon after, a month later.
2. The low of the Transports comes first and then rises. The DJ30 followed a month later with a low but that low is not matched by the DJ Transports. Again a leading indicator.
3. The DJ Transports spiked downwards on Friday but then regained its level. Should the indicator drop below the support trend again and close, the price could fall much further. If this is not matched by the DJ30, then divergence will continue to increase.
4. indicator show crossover which is . A fall below the would confirm direction.
5. It is possible the transports high was hit on the 21st of March. I'm expecting the DJ30 high to be hit within the next 20 days. Possibly as early as next week.