This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

12 Sell Downgrades Threaten Dow Transports

NEW YORK (TheStreet) -- The Dow transportation average has been the leading equity average so far this year. At last Thursday's latest all-time closing high at 6,281.24, Dow transports were up a staggering 18.4% year to date. While this parabolic rally occurred the transportation sector became 23.7% overvalued at Friday's close, the highest reading for this measure so far in 2013.

Back on Dec. 24 I wrote, Transports Shift Into Fast Lane and my buy-and-trade strategies profiled six buy rated stocks in the Dow Transportation Average.

Then on Jan. 16 I wrote, Transports Are Truckin' Ahead of Earnings where I updated my buy-and-trade strategies for these six buy rated stocks in the Dow transportation average and added two more.

My theme today is that truckers are getting flat tires at the end of the road, that the railroads face risks of derailment, and that the air freighters could be grounded because of 12 downgrades to sell within the Dow Transportation Average.

Among the eight buy rated stocks on Jan. 16, four have been downgraded to hold ratings and four have been downgrade to sell ratings. As a bigger sector warning, the Dow transportation average does not have a single buy rated stock, but instead has eight rated hold, a dozen rated sell and one with a strong sell rating.

With the weekly chart profile of the Dow Jones Transportation Average pinned with an extremely overbought 12x3x3 weekly slow stochastic reading at 95.24, there is no longer a reason to own any stock in this sector. My semiannual and annual pivots are 5955 and 5925 with a weekly risky level at 6350. My lower annual pivot is at 5469.



Chart Courtesy of Thomson/Reuters

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,060.51 +116.70 0.69%
S&P 500 1,977.44 +9.87 0.50%
NASDAQ 4,439.3910 +23.9010 0.54%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs