Mark Hulbert writes for MarketWatch that the Dow Transportation Average is “one of the most bullish sub-surface developments in the stock market” right now, having risen 4.4% in February as the Dow Industrial Average fell 1.6%. As Hulbert points out, he noted bearish implications in the Transports’ decline in December, just before the larger Dow Industrials index fell by more than 10% (Validea’s Guru Investor Blog post on that story is here). As Hulbert noted then and reminds us now, a U.S. Department of Transportation, Bureau of Transportation Statistics’ study concluded that over the past three decades the Transports Index “led slowdowns in the economy by an average of four to five months.” Hulbert also reminds us of “Dow Theorists” such as Jack Schannep and Richard Moroney who “believe that the market trends most likely to continue are those in which both the Dow Industrials and the Dow Transports are participating”, also see divergence between the two as indication of a possible change in market trends. Hulbert cautions that the recent divergence will need to persist for longer than its current two weeks to be viewed as a “buy” signal by Dow Theorists, but suggests that if divergence continues “you should give an increasing benefit of the doubt to the bearish case.”