The chart of the Dow Jones Transportation Average reveals that the pattern of lower highs in 2012, line b, has just been broken.
The on-balance volume (OBV) plot does not help us much, as the huge volume on September was 30 times the daily average, which distorts the OBV pattern.
If a weaver is going to invest six weeks in making a 4-foot-by-7-foot rug, she usually picks a pattern guaranteed to please an average buyer--somebody who doesn't want to be intellectually challenged by a floor covering.
That same pattern was responsible for cooler-than-average conditions in the West Coast states of Washington, Oregon and California, they said.
CNN: U.S. sees warmest March in recorded history, NOAA reports
The Dow Jones Transportation Average started to diverge in early 2012 and shows a pattern of lower highs, line b.
If we elect Obama and history's pattern prevails, expect 2008 to be positive but below average and 2009 to be above average.
If the U.S. elects Obama and history's pattern prevails, expect 2008 to be positive but below average and 2009 to be above average.
They know it, so attempts at major legislation have tended to crowd in the first two years hence stock returns on average have been more variable then. (For US stocks, but the pattern largely holds for global stocks.) There have been plenty of big double-digit positive years in years one and two, but the variability drags down the averages to 8% and 9% respectively.
But Sullivan argues in his recent newsletter that there is another historically accurate pattern that would keep you all in on stocks, especially big Dow Jones Industrial Average-sized stocks (note that Grantham and Ken Fisher love the very biggest blue chip stocks).
FORBES: Despite Election Worries Chartist Says To Go All In On Stocks
Pattern Recognition: Spotting Comeback Stocks : In 1884 Charles Dow published the very first stock market average composed of closing prices of eleven stocks: nine railroad companies and two manufacturing firms.
The weekly relative performance shows a pattern of lower highs, line f, and just recently turned down from its declining weighted moving average (WMA).
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