DIA is currently trading about 3.0% above its 200-day simple moving average while IYT is 0.9% above its 200-day average.
Anderson argues that transports will have to remain above their December 29 closing high of 9,217.44 to back a bull stock market. However, if the Transport Average dips continues to fall below its January lows, it would be a bearish signal.
iShares Transportation Average ETF
For more information on the transportation sector, visit our transportation category.
Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own shares of IYT.