The Dow has come roaring back with a gain of more than 1,000 points just this week.
A big move in airline, railroad and trucker stocks this month could suggest even more gains to come for the index, according to Matt Maley, equity strategist at Miller Tabak.
"We all know about the Dow Theory. Whenever they're both falling, the Dow Industrials Average and the Dow Transports falling in tandem, that can be very concerning," Maley said on CNBC's "Trading Nation" on Wednesday. "We saw that in October. They were both falling very hard."
The Dow Theory posits that a drop in demand for the products produced by Dow companies will have a knock-on effect on the need for the logistics and distribution services associated with the Dow Transports stocks. Those basket of stocks are used as a barometer on the broader economy.
However, their moves in November suggest that the worst-case scenario may not play out.
"The Dow Jones rolled back over and made a key lower low, but the transportation index did not. It made a higher low and in fact a much higher low, lead by a nice bounce in the airlines and the very economically sensitive railroad stocks," said Maley.
Those diverging moves in the two indexes imply that the drop in the Dow Jones is an isolated move and not indicative of a broader economic slowdown.
"If they can follow this higher low with a higher high, that's going to tell us that although the economy might slow down a little bit in 2019, it may not be as bad as people were worrying about in October and should be very bullish for the market," added Maley.
Chad Morganlander, portfolio manager at Washington Crossing Advisors, says a strong U.S. economy should continue to fuel gains for the group.
"The United States is growing in a quite vibrant manner of a 3-plus percent GDP handle that should sustain outperformance for the transports," he told "Trading Nation" on Wednesday.
Morganlander says one name in particular should see a sustained rally after suffering a sharp decline in October.
"Union Pacific — we like this company a whole lot over the next 18 to 24 months. It has very low debt. It has consistently grown, consistently profitable, and we think that overall that the dividend is going to continue to increase," he said.
After a 10 percent drop in October, Union Pacific has regained 4 percent this month. The IYT Transportation ETF has rallied nearly 6 percent in November.