Tuesday, March 20, 2018

Rotation Towards Transportation Stocks

Rotation to the Dow Transportation stocks is not some far fetched conspiracy theory. Relative performance of the tape suggests that the Transports are near an upside breakout and have been outperforming the Dow Industrials for several weeks.

As for leading equities higher, well, that job has been assumed by the technology and small cap stocks already (see PREV Matrix).

Headline: There’s a great rotation happening in the markets, and transports could take the driver’s seat: Oppenheimer technician

After trailing the S&P 500 during the past year, transports stocks could have their turn in the driver's seat, according to one technician's forecasts.

"Transports are an attractive rotation idea, and they could be that next area to lead equities higher," Ari Wald, head of technical analysis at Oppenheimer, told CNBC's "Trading Nation" on Monday. "Transports have been more or less an underperformer since 2015 and, in recent years, have been kind of [flat] on a relative basis."



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