The transports are having a field day! It's incredible. Look at the rallies in United Parcel Service UPS and Norfolk Southern NSC . Alaska Air ALK is back to being a stud. Where the heck did this rally come from?
Wrong question. Here's the deal. The transport index had been decimated by oil, by low coal prices, by crops. Now I am seeing all of these markets coming full circle for the transports. Oil, despite predictions that it would skyrocket off QE3, is sinking like a stone. Crops? Hey, wait until next year, they will be bountiful, or at least that's what people are thinking. Coal? Natural gas has moved up to the point where these pro-coal utilities are anxiously willing to switch back.
It didn't take long for the masses to turn bullish on the group. Now if FedEx FDX has anything positive to say at its two-day meeting, then I think we have the trend that will confirm the recent equity romp. Who knows how many shorts that will convert to this tape?
Soon enough we might just find out.