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Dow Jones Transportation Average (ATH)

Dow Jones Transporation Average
(Fresh All-Time-High)

Developed more than 115 years ago, "Dow Theory" - created in part by Charles Dow, the founder of the Wall Street Journal - is considered the oldest stock market indicator that's still followed by a broad swath of the investing public.

Dow Jones Transportation Index (Quarterly); bigcharts

It warned of trouble in late 1999, for instance, a few months before the dot-com crash in March 2000. And it sent a buy signal in April 2009, almost exactly at the start of the current eight-year-old bull market (DJT - weekly updated = Dow Jones Transportation Average - Index).

At its core, the theory looks for two major Dow Jones stock indexes - the Dow Jones industrial average and the Dow Jones transportation average - to "confirm" a trend on Wall Street. So for a bull market, for instance, you'd want to see record highs in both. As the theory goes: If the economy were truly humming, railroads and shipping companies that are needed to move goods across the country would be just as busy as the manufacturers of those products.

After some time, transportation stocks hit new record highs at the beginning of July 2017 putting the Dow Transports right in line with the Dow Jones industrial average for a bullish outlook. In the second half of November 2017 the Dow Jones Transportation Average even managed to climb over the 10,000 bar for the first time ever! Since December 2017 the Index managed to stay in the 5-digits-territory ( > 10k-level).

"Over the last 15 to 20 years, people have come up with many new-fangled indicators that they think are better at forecasting the market," says James Paulsen, chief investment strategist for The Leuthold Group. "But the reality is that some of the best indicators have been around for 100 years, and there's a reason they've been around for 100 years."

Paulsen says he wouldn't be surprised if this bull market - which at eight years of age is already the second-oldest rally in modern stock market history - continues to move ahead for another 12 to 24 months...(and this comment was being made in July the bull run can go on for another possible 7 to 19 months).