Some positive evidence for transports

Key points

• Trader sentiment has reached a washed-out level, with the 50-day average of the IYT Optix crossing above the 36% threshold on October 8, 2026.
• The Copper/Gold Ratio has plunged below the extreme 0.16 level; given transports' heavy reliance on metals and energy commodities, this reading historically marks a strong buying opportunity.
• However, because this is the first time the Copper/Gold Ratio has crossed below 0.16 recently, historical data warns that short-to-medium-term performance can remain weak.

Trader sentiment reaches a washed-out level

Jay noted in last week's report that the transportation sector is entering its most favorable season, suggesting its dismal performance could soon change. The recent emergence of new bullish signals supports the forecast for a favorable trend in the transportation sector.

When a stock, index, sector, or market declines sharply in price or lags for an extended period, investors eventually "throw in the towel". This overly bearish sentiment frequently indicates that a bottoming out may be at hand and is often reflected in readings from our Optix indicator.

The chart below displays the 50-day average for