Dow Jones Transportation Average Index: Short Sell At $140.33

 | May 21, 2014 01:06AM ET

From a technical view, the ETF is shaping a rising wedge pattern at this stage and it is reversing down from the upper part of the pattern. Regarding technical indicators, the weekly RSI is capped by a bearish trend line while the weekly MACD is posting a bearish divergence. On a relative basis against the IVV S&P500, the iShares DJ Transport Average Index (ARCA:IYT) is facing a huge resistance which should trigger a drop.

Trading strategy:

Short Sell at $140.33 - Stop loss at $144 - Target at $126.50