Weekly Dow Jones Transportation Index
Transports have been flying high for nearly a decade. Is this trend about to end?
This chart looks at the index over the past 14 years. Since the summer of 2009, they have been creating a series of higher highs along line (2).
Over the past year, they have created a series of lower highs, just below line (1). These two lines are forming a narrowing pennant pattern that has to end.
The recent weakness has Transports testing 10-year rising support at (3) this week.
Until broken, this is a strong support line for this key sector.
If the support line breaks at (3), Transports will send a concerning message to the broad markets.
Keep a close eye on what this important sector does in the next few weeks.