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DJ Transport ETF IYT: Bears: 2  Bulls: 1
 September 12 2016 ( From TradingView )
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The Situation

​​We just start to realize how deep and quick the correction at on September 9
​was ​on the World Bond Market and the FED fears on the ​​​​US equity market: ​
​From previous peak price made ​on September 8 2016 on the Dow Jones ​
​Transportation Average ETF IYT  (iShares Transportation Average ETF) at
​145.64, to the low on September 12 2016 at 139.74, ​a drop of 4.1%;
for the SP500 Index (SPY ETF), it was only a drop 3.0%.​

Rebounding from those technical levels was quite a statement ​from Mr Market
​but aint enough to repair the technical damage done. As Bond Yields get
more Volatile and FED Officials play the ping pong game in terms of their
comments, brace for a schizoprenic stock market behavior.​​

​​But the Mighty Dow Jones Transportation Average Index ETF (IYT) is trying to change his message as it still unable to outperform other Major Indices: it becomes that Bears got 2 points and Bulls only 1...


Here is some Technical Observations:​​​
​​1) From the peak price reached on August 23 for SPY ETF to the close reached on September 12, it was down by -1.5%; IYT ETF under performed with -1.9% from its previous peak reached on September 8 to the September 12 close. 
(See first chart below)

​​2)
On September 12, IYT ETF closed +4.3% above the 200 DMA (Day Moving Average) ​(See first chart below - Green line)​  but SPY ETF still +5.1% above its 200 DMA.

3) Historical Volatility (past 10 days) on SPY ETF is at 17.69, a lot lower than the IYT ETF at​​ 23.76.


​​​​​​​4) SPY ETF already broke its Major Resistance Trendline from 2015 on July 8, which was THE Major Breakout; IYT ETF finally broke on September 7 its own Major Resistance Trendline that started back since November 9 2015  But failed to stay above it. (See first chart below - Top Blue Trendline - Ellipse)

5) ​​Also on September 7 2016, on a relative basis (the ratio of Dow Jones Transportation ETF IYT ​to the Mighty Dow Jones Industrials ETF DIA) we broke the Major Resistance Trendline that started back since January 14 2016 ​​(See second chart below - Blue Trendline - Ellipse)​  but closed below the 200 DMA (Day Moving Average) on that ratio on September 12.  ​​(See second chart below - Green Line - Ellipse)​

​​6) ​Let s now compare to the Mighty SP500 Index on a relative basis. The ratio (Dow Jones Transportation ETF IYT ​to the Mighty SP500 Index ETF SPY) keep making lower highs and lower lows and broke on September 1 2016 the Minor Resistance Trendline and also failed to stay above the 200 DMA on that ratio. ​(See third chart below - Grey Trendline- Ellipse)​ .
And looking at Monthly charts on those ratios gives us a better overview. (See fourth and fifth charts below)

​As the ​​​​​Mighty DIA ETF got way over the previous peak reached on April 20 2016, the Dow Jones Transportation ETF IYT ​failed to reach yet the previous peak of April 2016 at 146.07 on IYT ETF. But we finally had an higher close on September 8 than the July 14 peak then cancelling the bad technical pattern of a lower highs and lower lows pattern.​​​

​​But most importantly, the Big Divergence is starting to fade between Dow Jones Transportation, the Dow Jones Industrials (See six chart below) and the SP500 Index (SPY ETF).

The First Battle for Bulls have been won on September 7 2016 by breaking the Major Resistance Trendline​​. The DJ Transport was the only Major Stock Market Index who did not break out yet technically speaking before that.  
​(See first chart below - Blue Trendline - Ellipse) That victory was short lived as we got below it.

The Bulls need absolutely that confirmation from the Transport to the Dow Theory to finally kick in.





​​




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Charles Dow
DJ Transport ETF IYT: Bears: 2 Bulls: 1 $DJT, $SPY #investing #dowtheory #SP500 #dowjonestransport #stocks #transport

Dow Jones Transportation ​ETF IYT
​( Daily 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 ( Candles )
Dow Jones Transportation ​ETF IYT 
over​
​Dow Jones Industrials ​ETF DIA
20 DMA ( Day Moving Average - Yellow Line )​
50 DMA ( Day Moving Average - Red Line )​​
200 DMA ( Day Moving Average - Green Line )​​

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

Financialiceberg.Com
Monthly RATIO ( Candles )
Dow Jones Transportation ​ETF IYT 
over​
​Dow Jones Industrials ​ETF DIA
Monthly RATIO ( Candles )
Dow Jones Transportation ​ ETF IYT
over​
​SP500 Index ​ETF SPY

Dow Jones Transportation ​ETF IYT ( Blue Line)
Dow Jones Industrials ETF DIA ​​( Daily Candles )

Financialiceberg.Com