Dow transports tumble into Dow Theory ‘sell‘ signal territory

The Dow Jones Transportation Average sank 283 points, or 2.7%, in afternoon trade, to push the index below a key technical level that could mark the start of a new longer-term downtrend. The key level is the Feb. 9 closing low of 10,136.61. A close below that level, coupled with the Dow Jones Industrial Average‘s close below its February low on March 23, and lower highs reached by both indexes last month, would trigger of market analysis, suggesting the previous longer-term uptrend was over, and a new downtrend had begun. Meanwhile, the Dow industrials plunged 670 points, or 2.8%, toward a 4 1/2-month low.