Transports Fail To Participate In Rally
There is one important stock sector that is failing to participate in today's early rally, it is the transportation sector. This sector is followed closely by many traders and investors as an indication of economic expansion when it rallies and economic contraction when it declines. After all, products must be shipped and delivered, therefore, this is usually a leading indicator. This morning, the iShares Dow Jones Transportation ETF (NYSE:IYT) is declining lower by 0.50 cents to $91.74 a share. This decline comes on a trading session where the Dow Jones Industrial Average (DJIA) is trading higher by over 1.00 percent. The IYT is showing weak relative strength this morning. Short term traders can watch for intra-day support around the $91.50, and $90.85 levels.
Some of the leading transports stocks that are not participating in today's stock rally include FedEx Corp (NYSE:FDX), United Continental Holdings Inc (NYSE:UAL), CSX Corp (NYSE:CSX), and Union Pacific Corp (NYSE:UNP). It should be noted that all of these stocks continue to remain strong on the daily charts, therefore, today's action must be monitored closely over the next few sessions. Strong stocks should always be watched when they fail to rally in a strong market as it could be a sign of things to come.