Dow Theory analysis

The averages provided a fairly textbook bear-market signal on March 10, dropped to fresh lows on panic selling in early April, then recovered most of the sell-off by late April after the reciprocal tariffs were paused. While the averages have rebounded more quickly than expected, we still think they are in the process of establishing important highs.

A move to all-time highs in the Industrials and S&P 500 Index would get our attention, especially if broader measures also reach fresh highs. If both the Industrials and Transports close at all-time highs, the primary trend would be undeniably bullish — and we’d have to conclude that the March 10 bear-market signal was mistaken.

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