The Dow divergence: Is the trend reversing?

During his time, he wrote a series of articles starting from the 1900s which in the later years was referred to as ‘The Dow Theory’.

This generally states that, the two key indices which Mr Dow and his partners invented, The Dow Jones Industrial Average , on the assumption that the business conditions were interdependent.

This mismatch of trend could cause a lot of market participants to rethink about the next course of action.

Infact, the blue line, i.e., the Dow Jones Transportation Average has made a lower low as compared to the black line, i.e., the Dow Jones Industrial Average.

The question therefore is, will this just be a short-term phenomenon or there is a much larger trend which could emerge out of this.

These series of observations could probably put the key indices and the near-term outlook into a spot of bother.

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