Downside Limited by Transports

May 5, 2011 11:15am by Barry Ritholtz

Yesterday, I created a list of “Things To Be Concerned About Regarding This Market.” I discussed those concerns yesterday (here).

Call it Anti-Confirmation Bias: Its something I like to do when we are fully invested (about 86% long). That list of ten items didn’t even include problems in Europe, US Housing, or other well know issues.

So far, the market downside has been limited. Even if you overlook this resiliency, it is hard to get too bearish when the Transports look like this:
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Dow Jones Transports (Daily)

click for ginormous graphs

Dow Jones Transports (Weekly)

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Of course, the Trannies could roll over tomorrow — and that would change out investment posture. But for now, as long as they remain within spitting distance of all time highs, its a tough market to be short in . . .

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