DJIA/DJT RATIO HAS POTENTIAL TO RISE

DJIA COULD BEAT DJ TRANSPORTS IN SHORT TERM

Did you know that the Dow Jones Industrial Average has swung five times at an average of 29 percent against the Dow Jones Transportation index over the past six and a half years? Have a look at the weekly plot of the DJIA/DJT ratio which highlights these big swings. But this chart doesnt tell the whole story because whereas the peak in the ratio here was at 3.019 in March 2009 and the low at 2.061 earlier this month the extremes over a longer period have been 4.254 In January 2000 and 1.856 in September 1989.