Dow Jones Transportation Average (DJTA)
The Dow Jones Transportation Average is a 20-stock, price-weighted index that represents the stock performance of large, well-known U.S. companies within the transportation industry.
Key facts
- The primary trend is decreasing.
- The decline rate of the primary trend is 4.35% per annum.
- Dow Jones Transportation Average (DJTA) at the close of May 17, 2024 was 15,501.43 and was higher than the top border of the primary price channel by 490.35 points (3.27%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is increasing.
- The growth rate of the secondary trend is 9.03% per annum.
- Dow Jones Transportation Average (DJTA) at the close of May 17, 2024 was inside the secondary price channel.
- The direction of the secondary trend is opposite to the direction of the primary trend. This indicates a possible reversal in the direction of the primary trend.
Linear Regression Model
Model equation:
Yi = α + β × Xi + εi
Top border of price channel:
Exp(Yi) = Exp(a + b × Xi + 2 × s)
Bottom border of price channel:
Exp(Yi) = Exp(a + b × Xi – 2 × s)
where:
i - observation number
Yi - natural logarithm of Dow Jones Transportation Average (DJTA)
Xi - time index, 1 day interval
σ - standard deviation of εi
a - estimator of α
b - estimator of β
s - estimator of σ
Exp() - calculates the exponent of e
Primary Trend
Start date: March 8, 2021
End date: June 26, 2023
a = 9.7191
b = -0.0001
s = 0.0597
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0001) – 1
= -4.35%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0597) – 1
= 26.99%
March 8, 2021 calculations
Top border of price channel:
Exp(Y453)
= Exp(a + b × X453 + 2 × s)
= Exp(a + b × 658 + 2 × s)
= Exp(9.7191 + -0.0001 × 658 + 2 × 0.0597)
= Exp(9.7585)
= 17,300.44
Bottom border of price channel:
Exp(Y453)
= Exp(a + b × X453 – 2 × s)
= Exp(a + b × 658 – 2 × s)
= Exp(9.7191 + -0.0001 × 658 – 2 × 0.0597)
= Exp(9.5196)
= 13,623.87
June 26, 2023 calculations
Top border of price channel:
Exp(Y1,032)
= Exp(a + b × X1,032 + 2 × s)
= Exp(a + b × 1,498 + 2 × s)
= Exp(9.7191 + -0.0001 × 1,498 + 2 × 0.0597)
= Exp(9.6562)
= 15,618.79
Bottom border of price channel:
Exp(Y1,032)
= Exp(a + b × X1,032 – 2 × s)
= Exp(a + b × 1,498 – 2 × s)
= Exp(9.7191 + -0.0001 × 1,498 – 2 × 0.0597)
= Exp(9.4173)
= 12,299.59
Description
- The primary trend is decreasing.
- The decline rate of the primary trend is 4.35% per annum.
- Dow Jones Transportation Average (DJTA) at the close of May 17, 2024 was 15,501.43 and was higher than the top border of the primary price channel by 490.35 points (3.27%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: May 18, 2022
End date: May 17, 2024
a = 9.2435
b = 0.0002
s = 0.0480
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0002) – 1
= 9.03%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0480) – 1
= 21.16%
May 18, 2022 calculations
Top border of price channel:
Exp(Y756)
= Exp(a + b × X756 + 2 × s)
= Exp(a + b × 1,094 + 2 × s)
= Exp(9.2435 + 0.0002 × 1,094 + 2 × 0.0480)
= Exp(9.5986)
= 14,743.49
Bottom border of price channel:
Exp(Y756)
= Exp(a + b × X756 – 2 × s)
= Exp(a + b × 1,094 – 2 × s)
= Exp(9.2435 + 0.0002 × 1,094 – 2 × 0.0480)
= Exp(9.4067)
= 12,169.09
May 17, 2024 calculations
Top border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 + 2 × s)
= Exp(a + b × 1,824 + 2 × s)
= Exp(9.2435 + 0.0002 × 1,824 + 2 × 0.0480)
= Exp(9.7715)
= 17,526.76
Bottom border of price channel:
Exp(Y1,258)
= Exp(a + b × X1,258 – 2 × s)
= Exp(a + b × 1,824 – 2 × s)
= Exp(9.2435 + 0.0002 × 1,824 – 2 × 0.0480)
= Exp(9.5796)
= 14,466.37
Description
- The secondary trend is increasing.
- The growth rate of the secondary trend is 9.03% per annum.
- Dow Jones Transportation Average (DJTA) at the close of May 17, 2024 was inside the secondary price channel.