Being a technical analyst, occasionally you see things that you question why have more traders not seen or carefully considered this?

For example, Fed Ex.

Fed Ex is a fantastic future price prophet for the S&P 500 and really the whole U.S. economy.

On October of 2007, Fed Ex dropped and broke underneath the S&P 500. That move down led the S&P 500 by 2 months. In other terms, Fed Ex predicted the nose-dive in the S&P 500 by 7 weeks.

In this video, I study 8 years worth of data on both Fed Ex and the S&P 500 to show you the inter-market relationship between both of these stock charts.

The stock charts demonstrate that when Fed Ex is above the S&P 500 and leading higher, it gives a very bullish signal not only for the S&P 500 but the entire U.S. economy. While the S&P 500 is above Fed Ex and Fed Ex is leading lower, this provides a extremely bearish signal for markets.

Looking at June of 2009, Fed Ex started leading the S&P 500 higher. Something that is really interesting is that when Fed Ex leads the S&P 500 by an adequate amount to make a big gap, it is even more bullish for the stock market. So you can measure the gap between Fed Ex and the S&P 500 to calculate bullish outlook of investors in addition to current health of the U.S. economy.

The gap between Fed Ex and the S&P 500 lessened at the first part of April 2010 before the Euro crisis hit mainstream news and the S&P 500 fell 3 weeks later.

Studying June of 2010, once again, Fed Ex started to gap ahead of the S&P 500 and that big gap still exists on today’s chart. This wide gap forecasts an upward future price move for the S&P 500 in short order.

On July 26 2010 Fed Ex raised its earnings outlook for the fiscal first quarter and remainder of the year, with the transport monster telling us express and ground volumes have been higher than projected.

The basis for why Fed Ex is a great future price forecaster of the S&P 500 and in fact the entire U.S. economy should be evident. When business and industry improves, shipments explode. For you Dow Transports theorists, Fed Ex is what trains were to the U.S. economy many years ago. Obviously we do not use trains like we use to anymore but instead shipping businesses like Fed Ex.

A good example of how Fed Ex is mixed up in most things can even be applied to a diverse sector such as property management. As banks start to release credit and apartment complexes start to sell, property management services are required. Mortgage payments need to be made when sufficient rents are collected. The mortgage payments are then paid by checks via overnight Fed Ex. This is merely one case of how interrelated our economy is and how no matter how diverse a business is, it is linked to Fed Ex somehow.