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While the ever-rising DJIA is up ~11% this year and hovers not far off five-year highs, the Dow...

While the ever-rising DJIA is up ~11% this year and hovers not far off five-year highs, the Dow Transports dropped 5.9% this week, hitting its lowest level since June and down 2.2% YTD. “This is a major divergence that should not be ignored,” Peter Boockvar says. “It tells me the risks of being in the market at these levels are growing."
Comments (9)
  • David Urban
    , contributor
    Comments (1036) | Send Message
     
    The divergence has been ignored for months now.
    22 Sep 2012, 09:39 AM Reply Like
  • Neil459
    , contributor
    Comments (2644) | Send Message
     
    Dow theory on its own has been irrelevant for years. Now if we could get rid of the government interference in the markets, then we might be able to use it once again.
    22 Sep 2012, 05:24 PM Reply Like
  • David Urban
    , contributor
    Comments (1036) | Send Message
     
    Dow theory actually still holds relevance but I agree with you on government interference.

     

    They think they are doing a good thing but the more people see the interference the more they are turned away from the market hampering their efforts.
    23 Sep 2012, 02:00 AM Reply Like
  • piggysun
    , contributor
    Comments (228) | Send Message
     
    last time i tried to pay attention, loaded uvxy, and lost 20% in days. This market is very different.
    23 Sep 2012, 05:58 AM Reply Like
  • ralennen
    , contributor
    Comments (15) | Send Message
     
    The market's ability to remain irrational outlasts an individual's ability to remain solvent-to paraphrase Keynes. At the upper levels of the market's trading range, is it not prudent to take some chips off the table notwithstanding QE3, Draghi, and election year history?
    23 Sep 2012, 01:23 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3533) | Send Message
     
    Oil up, transports down. Isn't there a connection?
    23 Sep 2012, 04:22 PM Reply Like
  • David Urban
    , contributor
    Comments (1036) | Send Message
     
    It is more of a transports/industrials connection.

     

    Oil has been out of sorts this year.
    23 Sep 2012, 04:30 PM Reply Like
  • Bill Cleugh
    , contributor
    Comments (5) | Send Message
     
    In the last 60 days, by following and matching the SPX with IYT has returned more than 300% when buying options on the SPX. Pull up both charts and match these dates: July 6th, a top; July 25th, a bottom; July 30th, a top; Aug 3rd, a bottom, Aug 7th, a top; Aug 12th a bottom, Aug 21st a top; Sept. 5th a bottom and Sept 17th a top, and a bottom is still under construction, which I speculate a bottom in both will arrive Wednesday or Thursday this week. IYT usually scribes out a double bottom (hourly) or double top, as the S&P comes to an actionable top or bottom on the same day.
    Blaming the Government or some other facility for your troubles is like blaming your tools for a job poorly performed. In stead of pointing fingers, I would suggest you do more home work and make that 300% profit like me. Cheers, Keymosabie
    24 Sep 2012, 01:27 PM Reply Like
  • Neil459
    , contributor
    Comments (2644) | Send Message
     
    Bill, yep it worked, but what would have happened if Obama had decided to target smog producing trucks, or some other component of the transportation index. He could sink it without even knowing what he was doing. So my point still stands, Dow theory only works when the government stays out. Currently, with this administration, we do not know what business sector they are going to attack next.

     

    Admit it, that is what a community antagonizer does. And with Obama it is the only skill he has.

     

    So yeah, that my have worked but at what risk.
    26 Sep 2012, 10:21 AM Reply Like
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