Dow transports soaring with skyrocketing fuel costs

Discussion in 'Trading' started by LT701, Apr 27, 2008.

  1. LT701


    this was touched on in another thread, but the thread suffered from many of the usual ET thread problems

    but in my opinion, this is one of *the* key technical analysis issues in the market at this time (IE, counterintuitive signals being sent in the market) - my inclination is bearish, but manipulation (which has been present in the market from the beginning of time) or not, transports are rallying. maybe they're rallying to a 'head and shoulders', but they're approaching new highs nonetheless

    some say it's the ag boom. but i'm in an ag state, corn is being planted in fields that always had corn. are there really that many more crops being planted? (although grain may being moved from storage to market to sell at strong prices)

    is this enough to make up for all the housing materials that clearly are NOT being moved?

    i'm perpelexed by this

    any constructive comments on this?
  2. LT701


    by my observation, spx is in a bear, and dow transports are not

    so by dow theory, there is some big time non-confirmation going on

    any thoughts?
  3. paden


    Everything I am looking at is bullish, which makes me think i need to short...

    Look at midcap 400, now that is bullish
  4. I've noticed a lot of threads trying to understand the current price action. Why are we seeing a huge rally, when the US is teetering on collapse? It boils down to understanding what inflation is, and how it works.

    Monetary expansion via fiat printing always flows first into the big banks and corporations. They are the first to receive the money, so they get to freely buy up indexes and commodities to their now new inflated value, making free money and thereby cleaning up the losses from the credit collapse. Once they profit from the expansion and inflation, they will start extending credit to the rest of society (trickle down).

    But, by the time the money is injected back into the economy through credit, huge imbalances have already been made by the inflationary pressure.

    So, if you think about the last month and the federal reserve actions swapping shit paper for treasuries, you will see the new money flowing into the financial markets and commodities.

    It's not so much that all the bad news has been priced into the market, it's that all the bad news has been inflated out of the market.
  5. LT701


    well, you're certainly right about the citizen paying for the bailout at the gas pump. with zero time lag
  6. Time 2 buy as always

    Rally in transports is a bullish indicator for economy down the road
  7. LT701


    another banner day in the transports