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One of the interesting aspects about the broad market correction since April is how many veteran technicians have extrapolated on the gloom and doom that awaits our future, without so much as acknowledging some glaring bullish divergences. Now, I recognize that I am just some punk blogger, whereas Richard Russell and Art Cashin write their daily limericks to much fanfare and praise.
However, riddle me this, elderly sirs–Why have the transportation stocks failed to come even remotely close to breaching their February lows (as opposed to the S&P and countless other indices/sectors/stocks)? Moreover, why, good sirs, have the trannies now broken out of their multi month falling channel if the world is, indeed, ending within a year?
To be sure, there is a lot of work to be done in terms of backing and filling, even if the next move is much higher from here. However, the trannies are historically leading indicators, and to hear technicians/theorists like Prechter and Russell ramble on about an epic move lower is just not evident in the charts yet.
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