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DJ Transports / SP500 Index Technicals: DJT Testing Major Support ?
 January 13 ( From TradingView )
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The Situation

We just start to realize how deep the correction was on the ​​US equity market:
On the low made on August 24 2015 on the Dow Jones Transports ( DJT ) at
​7452.70, even if few realize that the DJT now trade well below that level.
​( See first chart below: Amber Trendline )
Rebounding from those abyssmal technical levels was quite a statement
​from Mr Market in August 2015 but since then more and more divergence
​occuring ​between the Mighty Dow Jones Transportation Average Index (DJT)
​and the ​Dow Jones Industrial Average (DJI)​.

​​In fact, different technical indicators or trendline make a huge divergence:

Why so: ​
1) SP500 Index is at only 9.1% from its peak reached on May 20 2015.​  
​​( See first chart below )​

​2) SP500 Index is in far of testing the Monthly Major Support Trendline that started back on March 2009. ​​​
( See first chart below - Thick Blue Trendline )

​​3) DJT is at 25.0% from its peak reached on November 28 2014.​
​​​​( See second chart below )​

​​​​4) DJT is testing already the Monthly Major Support Trendline that started back on March 2009.
​​​​( See second chart below - Thick Blue Trendline - Ellipse )​

​ONE chart below is worth a look where we will show the ratio of the ​​Dow Jones Transportation ​to the Mighty SP500 ​( Bottom Chart )...

​Since October 26, the 50 Day Moving Average on that ratio started a brand new downtrend​ ​( DJ Transport started to underperform the SP500 ); It reached a level last seen in December 2012... ​( Bottom Chart - Grey Line )

​​​​​But the interesting technical factors is that it is the first time that we have a Major Divergence since the past two years as the ratio is making lower highs but not the Mighty SP500. Quite surprising that DJ Transportation underperform with Oil price historically low...​​


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Charles Dow
DJ Transports / SP500 Index Technicals: DJT Testing Major Support ? $DJT, $SPY #investing #dowtheory #SP500 #dowjonestransport

Dow Jones Transportation ​( Monthly Candles )

SP500 Index ( Monthly Candles )

Dow Jones Transport ​
​SP500 Index ( Top Panel - Blue Line )
50 DMA ( Red Line )​

and SP500 Index​ ( Bottom Panel )