In my work I've found that more often than not the transportation stocks (I use the Nasdaq Transportation index, TRAN) have a leading function.
Now this is nothing new as any Dow theorist would tell you, but let me show you a chart below of how the TRAN currently looks and what clues it gave us that an equity sell-off was coming:
The chart below doesn't show it, but look at a multi-year chart of TRAN and you will see meaningful resistance from back in 2008 around $2590.
Next, the chart below nicely depicts how the index did not (unlike the S&P500) make a new high this week. In fact, TRAN retraced 61.8% of the sell-off from Jan 18-25 and from there (this morning) is failing miserably to the downside.
I am short via the IYT with a first target just shy of $90. Keep this index on the radar.