DJTA, Dow Jones Transportation Average a.k.a the Rails, OSG

djta jul 2012

The DJTA has outperformed the Dow Industrials, it is also the older of the two. Why has it done so well when shipping companies are down so much? Simple because not that much is transported by Americans , stock listed companies, in America by water. Of the 20 companies in this index only two are classified as “maritime”. One , ALEX, Alexander & Baldwin is a Honolulu based land-owner active in agribusiness, sugar cane etc. At best it runs a few ferries between the Hawaiian islands. The other is OSG, Overseas Shipholding Group. It too has gone down like a rock but as this index is cap-weighted its significance in the index is fast approaching zero. Here are the charts;

osg 2012osg m 2012

osg s 2012

We give all three, big , medium and small. We are 100% confident about the big picture, it is nearly there. We are not certain about the triangle , it may not be wave 4 but just part of it, but the final result should still be a little lower. Should be a buy if and when it gets to about $6