Transport Watch

A solid one-day gain on heavy volume for many indices will have given bulls something to cheer. There wasn't a whole lot of technical change, other than a few moving averages were breached (once again) to the upside in what has been a tough whipsaw period. The one index which caught my attention was the Transports - for the Dow theorists.

The DJ Transport Index closed just shy of declining resistance dating back to May of this year. There was a stochastic crossover, but the signal occurred above oversold levels. Trend strength is (very) weak - so the odds of a break are not very high, but if it was to happen then Friday would be a good day for it.

Keep one eye on it at least. Futures point to a flat open as of 6 am ET.

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, market alerts and stock charts website

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