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DJ Transportation: Critical Major Support?
 June 27 2016 ( From TradingView )
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The Situation


​We just start to realize how deep the correction last summer was on the ​​​US equity market: 
​On the low made on August 24 2015 on the Dow Jones ​Transportation Average ( DJT ) at ​
​7452.70, even if few realize that the DJT now trade ​just slightly below that level after the
​Brexit vote.     ​(See first chart below: Amber Trendline)
​​​
The Mighty Dow Jones Transportation Average Index (DJT) is keeping the same message
for awhile as it keep underperforming other Major Indices.​

Here is some Technical Observations:​​​
​1) DJT underperformed with 10.2% from its previous high reached on April 20 2016
​and SP500 is at only 3.9%​​​​ from its previous high reached on June 8 2016. (See first chart below)​

​​2) DJT from highest peak price (reached on November 28 2014) to the lowest price yet (reached on
​January 20 2016) was 31.2% and only 15.2% for the Mighty SP500. ​​​​(See first chart below)​

​​​​3) DJT broke on June 13 2016 the Daily Support Trendline that started back on January 20 2016​. ​​​​
​(See first chart below - Blue Trendline)​

​​​​​​​4) DJT is now below the Fibonacci Retracement  zone of .50% at 7857 (From peak price on May 20 2015 to the Low price on January 20 2016).

5) ​​On March 18 2016, on a relative basis (the ratio of Dow Jones Transportation ​to the Mighty Dow Jones Industrials) we kissed the 200 DMA (Day Moving Average) ​​(See second chart below - Green Line - Ellipse)​ and failed to stay above. We are now at the lowest relative level since March 18 2016. ​​(See second chart below - Bottom Right Ellipse)​

​​6) ​​Almost the same battle with the Mighty SP500 Index on a relative basis. The ratio (Dow Jones Transportation ​to the Mighty SP500 Index) tested the 200 DMA (Day Moving Average) on April 21 2016 and was rejected. (See third chart below - Green Line - Ellipse)​ .
​We are now at the lowest level on a relative basis since March 18 2016. ​​
​(See third chart below - Bottom Right Ellipse)​

 ​
As the ​​​​​Mighty SP500 Index got over the previous peak reached on November 3 2015, the Dow Jones Transportation ​it failed to reach yet the 8300 zone peak  in November 2015; it is still into a lower highs and lower lows technical pattern, a completely different pattern than the SP500 Index. ​​​(See First Chart - Thick Grey Trendlines )

​​But most importantly, what puzzle me the most is that, a Big Divergence continue to prevail between Dow Jones Transportation the Dow Jones Industrials and the Mighty SP500 Index. As the keep underperforming, it become a serious warning from the Dow Theory.

And as few of us realize, the Dow Jones Transportation Index is testing back the Major Daily Support Trendline​ that started back since March 2009. It become critical for Bulls to protect that zone, unless we have a breakdown.





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Charles Dow
DJ Transportation: Critical Major Support?  $DJT, $SPY #investing #dowtheory #SP500 #dowjonestransport

Dow Jones Transportation ​
​( Daiy Candles )
​20 DMA ( Day Moving Average - Yellow Line )​
50 DMA ( Day Moving Average - Red Line )​​
200 DMA ( Day Moving Average - Green Line )​​

Financialiceberg.Com
Financialiceberg.Com
Daily RATIO ( Blue Line )
Dow Jones Transportation ​
over​
​Dow Jones Industrials ​
20 DMA ( Day Moving Average - Yellow Line )​
50 DMA ( Day Moving Average - Red Line )​​
200 DMA ( Day Moving Average - Green Line )​​

Daily RATIO ( Blue Line )
Dow Jones Transportation ​
over​
​SP500 Index ​
20 DMA ( Day Moving Average - Yellow Line )​
50 DMA ( Day Moving Average - Red Line )​​
200 DMA ( Day Moving Average - Green Line )​​

Financialiceberg.Com