Transports Break higher
The transportation index is breaking out as you can see in the above chart. Some of the rails were very strong today such as UNP and BNI. It looks like the next target for this index is the 5000 area.
In the lower panel is the ratio line of the Transportation index divided by the S&P500. As you can see this ratio line has not been trending up which means it has been under performing the overall market. The chart looks good but given the under performance, I'd leave them alone...There is better stuff to buy.
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1 comment:
Your right K, to leave 'em alone.
Granted the GDP came in strong but the Chicago index contracted. 1 reason they were strong, as you know, was due to the Fed statement.
I think the transports will increasingly trade depending on economic data in the upcoming weeks, especially the ISM and GDP #s and less so on CPI/PPI.
Right now the Fed futures barely are indicating a rate hike even in the 2H of 07, once that # ticks up transports might come down.
Let's see.
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