Dow Theory

[winston]

THE TRANSPORTS ARE SOARING... AND THAT'S A GOOD THING

The Dow Transports are in a bull market... and that's a good sign for the economy.

While most folks just pay attention to conventional stock averages like the Dow Industrials, market traditionalists (like us) also pay attention to the Dow Jones Transportation Average.

This stock index tracks the performance of railroad, airline, trucking, and freight companies. Big transporters like FedEx, Union Pacific, UPS, and Norfolk Southern are components of the average.

There's a good reason for watching the transports. If the shippers of goods are enjoying robust profits and share prices, the economy can't be doing that badly. If the transports are tanking, it's a danger sign for the economy.

As you can see from the chart below, the transports aren't tanking... they're in a big bull market.

The Dow Jones Transportation Average has climbed from 5,250 to 7,700... and sits near an all-time high. Despite what the pessimists would have you think, things can't be all that bad with the economy.


Source: Daily Wealth

[winston]

IT'S NOT JUST OCEAN SHIPPERS...

Yesterday, we highlighted the strength in companies that ship goods and material across the oceans. But ocean shippers aren't the only ones doing well. The entire shipping complex is in a bull market. Today's chart displays it.

Most folks have heard of the "Dow Jones Industrial Average." It's the stock index frequently quoted by the mass media. It tracks many of the most important American stocks, like Bank of America, Wal-Mart, and IBM.

Another extremely important – but underfollowed by the public – stock average is the Dow Jones Transportation Average. This index tracks the most important trucking companies, railroad firms, airlines, and freight shippers.

Major constituents of this index include FedEx, Delta Air Lines, UPS, Union Pacific, and Norfolk Southern. Three years ago, we highlighted this index as a major reason to stay bullish on stocks. Our advice was right on.

As you can see from today's chart, ocean shippers aren't the only stocks doing well. The entire shipping complex – railroads, trucks, ships, and airlines – are moving higher. Last week, the "transports" hit an all-time high. We look at this and say, "Things can't be all that bad" for the global economy.

Source: Daily Wealth

[winston]

A GOOD SIGN FOR THE BULL MARKET

Transportation stocks hit a new all-time high last week... and that's good for the bull market in stocks.

The "transports" are a widely followed sector, thanks to Charles Dow.

Dow is the legendary founder of both the Wall Street Journal and the Dow Industrials Average. He also developed a famous method of stock market analysis called "Dow Theory."

One of Dow Theory's main ideas is to monitor both industrial shares (the manufacturers of goods) and transportation shares (the transporters of goods). This gives the investor a "big picture" view of the economy and stock market.

Dow reckoned if both manufacturers and transporters were enjoying higher stock prices, they were "confirming" a bull trend.

Below is a two-year chart of Dow's modern-day transportation index, the Dow Transports. The index tracks America's largest railroad, trucking, and freight companies. As you can see, the index is in a long-term uptrend and just broke out to a new all-time high. It's still a "Dow Theory confirmed" bull market.

Source: www.dailywealth.com

[winston]

Transportation stocks confirm the stock market's uptrend… transport fund IYT hits a new all-time high.

[winston]

MORE PROOF THE U.S. ECONOMY ISN'T FALLING APART

More proof that things can't be all that bad with the economy: Transportation stocks just hit another new high.

Over the past four years, we've run dozens of charts that prove "things can't be all that bad" in the U.S. economy. We've featured charts of "real-world" indicators like soaring home-improvement stocks, soaring hotel stocks, and soaring financial stocks.

Transportation stocks are another great example... We figure if folks are shipping lots of raw materials and manufactured goods across the country, it's a good sign for the U.S. economy.

Below, you'll see a two-year chart of the Dow Jones Transportation Average. This index tracks the most important trucking companies, railroad firms, airlines, and freight shippers. Major constituents of this index include FedEx, Delta Air Lines, UPS, Union Pacific, and Norfolk Southern.

As you can see, transportation stocks have soared over the past two years. And despite a steep sell-off earlier this month, the index just rallied to a new all-time high. It's more proof that things can't be all that bad in America.

www.dailywealth.com

[winston]

MORE GOOD NEWS FOR AMERICA

Low fuel prices are boosting the Dow Transports... and that's a good sign for the U.S. economy.

While most folks just pay attention to conventional stock averages like the Dow Industrials, market traditionalists (like us) also pay attention to the Dow Jones Transportation Average. This stock index tracks the performance of railroad, airline, trucking, and freight companies. Big transporters like FedEx, Union Pacific, UPS, and Norfolk Southern are components of the average.

There's a good reason for watching the transports. If the shippers of goods are enjoying lots of traffic, robust profits and rising share prices, the economy can't be doing that badly. If the transports are tanking, it's a danger sign for the economy.

As you can see from the two-year chart below, the transports aren't tanking... they're in a big bull market. Since mid-October, the Dow Jones Transportation Average has climbed from 7,750 to 9,250... and sits near an all-time high. Despite what the pessimists would have you think, things "can't be all that bad" in America.

Source: Daily Wealth

[winston]

Transportation stocks take a breather… sector fund IYT sinks to a three-month low.

[behappyalways]

A stock market 'leading indicator' is tanking. But why?
http://money.cnn.com/2015/06/10/investi ... d=SF_River

[winston]

Transportation stocks struggle in 2015… sector fund IYT is down 10% since January.

[winston]

Dow Theory component (transports) nearing breakout level by Chris Kimble

Some believe in the basic premise of the Dow Theory, in that it is “good to see strength in the Dow Jones Industrials, Utilities and Transports indices, at the same time.”

The reverse is true as well, if all three are weak, it does NOT bode well for the broad markets.

Today, we take a look at the Dow Jones Transports Index (DJT) and how it is facing breakout levels…

For most of the year, the Transports index has been weak, as it started heading lower, before the broad market did. This divergence had many concerned that a large decline in the markets was in store.

As you can see, the Transports index has remained inside of rising channel (A) over the past 5-years. The decline this year did nothing more than take the index down to dual support, which was, its 161% Fibonacci extension level and rising channel (A) at (1). The decline in this index looks to have found dual support to be important.

Now, the Transports are testing breakout resistance line (2) at this time. Momentum is oversold, hitting levels seldom seen over the past 15-years.

If Transports can breakout here, momentum would suggest it could rally for a while, since it’s so oversold.

If Transports can breakout above (2), it would send a bullish message to the broader markets.

Source: Kimble Charting Solutions

http://thecrux.com/according-to-dow-the ... big-rally/