Mark Hulbert: Who does Dow Theory say will win this one?

Who does the Dow Theory say will win?

No, I’m not referring to the presidential election.

Instead, I’m talking about the contest between the Dow Jones Industrial Average DJIA, +2.08% and the Dow Jones Transportation Average DJT, +3.16% .

The Industrials, of course, have been weak since late summer. Even after their 300+ point rally to start off this week’s trading, this benchmark remains nearly 3% lower than its all-time high set this past August.

The Dow Transports, in contrast, are more than 5% higher over this same period. (See chart.)

This nearly eight percentage point spread is unusually large for so short a time.

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