🚨 I’ll be live at 2:30 p.m. ET with Alex Reid🚨
We break down INTC’s historic 20% run and the market’s push back to all-time highs. We’re decoding the DOJ’s latest move and where the money is flowing for next week. Is this a ‘buy the news’ moment or a time to hedge [tap to join us for Profit Panel]
Something caught my eye this week that’s got me scratching my head. While the S&P 500 (SPY), Nasdaq 100 (NDX; QQQ) and Russell 2000 (RUT) were making new all-time highs, one major index was sitting on the sidelines — the Dow Jones Industrial Average (DJI).
The Dow hit 50,000, and ever since then, it hasn’t been back. It’s been trying — don’t get me wrong — with a recent high of 49,700, but it just can’t break back above 50,000 while the other major indices keep printing fresh records.
You might think the old economy sector is struggling, but that’s where it gets interesting.
Transportation Stocks Are on Fire
The Dow Jones Transportation Average (DJT) has been in full rally mode. CSX (CSX) surged higher with a strong move, and Norfolk Southern (NSC) pushed up as well.
What makes this move stand out is how selective the strength really is.
When transports move like this, especially with major names having head into earnings, it’s usually a sign money is flowing into areas tied directly to real economic activity.
Yet the Dow Industrials still can’t reclaim that 50,000 level.
What This Divergence Really Means
The Dow’s weakness while other indices surge creates a real head-scratcher for anyone watching market breadth. It’s not that the entire traditional economy is under pressure — it’s just those 30 Dow components getting left behind.
And that matters, because the Dow is a small club with only 30 stocks, and it’s price-weighted, not cap-weighted. That means a handful of higher-priced names can drive the entire index. If just a few stall, the whole Dow drags, even while the broader market pushes higher.
There’s also a global layer here. Energy markets continue to feel the impact of Middle East dynamics, especially how oil flows and policy decisions ripple through pricing.
When crude shifts on geopolitics, it feeds directly into transportation costs, industrial margins and overall sentiment, which can amplify divergences like this.
So while transports are rallying hard and the rest of the market keeps breaking records, the Dow staying below 50,000 could be signaling something deeper — either a catch-up trade or a shift in leadership most traders aren’t paying attention to.
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Geof Smith
Geof Smith TradingÂ
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.Â
P.S. Hormuz, Oil, and the Gold Trap
Gold has been sending mixed signals lately.
In the past, rising global tension (especially around oil) has pushed gold higher as a safe haven.
But that’s not what we’re seeing right now.
Even as tensions build, gold has pulled back. And that’s where things get interesting.
So the real question becomes:
Is gold getting ready for another push to new highs… or setting up for a different move entirely?
Because from here, it could go either way.
- A renewed surge that challenges all-time highs
- Or a stall if factors like the dollar or rate outlook shift
If you’re unsure how to read this price action…
I put together a detailed Gold broadcast to walk you through it.
Inside, you’ll see:
- How gold typically reacts during geopolitical conflicts
- What tends to happen if tensions escalate… or suddenly cool off
- And whether this looks like the start of the next major move higher
No trading guarantees, of course.
But if you want a clearer view of where gold could be headed… and how to think about positioning…
Disclaimer: We develop strategies to the best of our ability, but we cannot guarantee a future return. There is always a risk of loss when trading. Past performance is not indicative of future results. Since 12/05/2024, the trading approach discussed today has published 60 trade alerts. All 60 have returned as winning trades, for a 100% win rate. The average return per trade, winners and losers combined, has been 16.88% on an average holding period of 9 days.
