Do you remember when some Dow Theorists were admonishing us about the Transports’ bearish divergence to the stock market? Well, 6 weeks ago in NFTRH 415 we noted this chart and how a similar divergence resolved bullish in 2012 and also how the Tranny itself had a bullish pattern (chart from Yardeni.com). Dow Theory (at least as interpreted by bearish prognosticators in recent months) has failed again.
On November 8 we did an NFTRH+ update (now public) on the Tranny, using the IYT iShares, which I bought on the opportunity noted in the update. Here is the original daily chart from the update (which also included a bigger picture weekly for more perspective and targeting), showing the pullback/buying opportunity we reviewed in real time.
Here is the same chart updated to today.
It’s very over bought and that always makes me want to sell, as it did with the big explosion in GS (which is now 10 bucks higher than my sale price and the NFTRH+ target). But the original target for IYT was 170 and since I am balanced in my portfolios I think I’ll hold it for now.
Insert here the ‘I make bad trades too’ disclaimer, but if you look at the original update I think you will see a well thought out trade scenario presented to subscribers at the exact moment it should have been presented.
Subscribe to NFTRH Premium for your 30-45 page weekly report, interim updates and NFTRH+ chart and trade ideas or the free eLetter for an introduction to our work. Or simply keep up to date with plenty of public content at NFTRH.com and Biiwii.com. Also, you can follow via Twitter @BiiwiiNFTRH, StockTwits or RSS.