The third and final post in my Dow Theory series. In this post, I address the use of Dow Theory in anticipating broad market trends. I take a look at classical Dow Theory analysis of the Dow Jones Transportation Average and its correlation with the Dow Jones Industrial Average (the Dow Theory proxy for the US economy as a whole).

For an overview of Dow Theory, please visit my first post on the topic. Or, check out the second post on peak-and-trough analysis and spotting primary trends.