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3 Charts That Suggest Transportation Stocks Are Heading Lower

Casey Murphy

One of the main tenets of Dow Theory is that major trends are identified when a major average such as the Dow Jones Transportation Average moves beyond its previous swing high/low and is then confirmed by movements in other indexes. As a result, many active traders tend to keep a close eye on the transportation sector and look to it as a leading indicator that can predict the movements of the broader market. As discussed above, the transportation sector is often looked to as a leading indicator that points to how traders expect the broader market to behave.