Charles Dow's theory - page 3
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See a doctor yourself and find a cure for jealousy! No one in the world has yet fully understood my work, and it would be strange for you to understand anything. Don't get upset.
And you have a desire for greatness without the delusion that is called envy, the attacks of which are not cured anywhere except in a crematorium.
God forbid you should envy such a thing! It's like they say - dibs on me, dibs on me!
When God wants to punish a man, he takes away his mind.
It is sad to see all this.
3 trends and 3 trend phases
The second and third postulate of the Dow theory has to do with market trends.
The market includes three types of trend. There is a concept of market trend in the method. The authors explain the concept as follows: a trend line is a price movement in which every new high is higher than the previous one or a new low will have a location lower than the previous low.
Each long-term trend can be divided into certain phases which have their own development stages. Like any cyclical system a trend has a kind of a starting point, a climax and a conclusion.
Indices are obliged to agree.
The fourth postulate of the theory states that all stock market signals, indices must be confirmed. At the moment of making any decision, Forex traders take into account some signals. The signals give different indicators or show the dynamics of a particular market segment. These signals are also mentioned in Charles' theory. It says that these signals should be compared with each other, and that they can only be used when changes in indicators are not opposite.
Trading volume supports the trend
According to Mr. Charles's fifth postulate, any trend should be supported by the trading volume. To be sure of the formation of a trend, you should compare the dynamics of trading volume in Forex and the price dynamics. A change in the same direction will tell the trader that this is a real trend. If the price changes and the trading volume does not change, we can conclude that we are witnessing an ordinary trend with unknown reasons. And this will not herald any change in the global trend.
Signal of a trend reversal
The sixth postulate of Dow says that no trend is complete until there is a reversal signal. This postulate is considered the most accurate of all the statements described in Senor Charles' approach. However, few people know how to use it correctly. In the technical analysis by this method, you should not make deals against the current trend and try to predict the moment of its reversal. Such transactions do not promise anything good. The market will signal to you itself about the reversal, you just have to watch it carefully. It is better to lose only a part of your profit in the beginning of trading, than to incur continuous losses due to ignorance and baseless trades. Stick to the Dow method and open trades in the current trend, not against it. You should always do this, even if you see prices changing in a different direction. Such moments should be seen as a correction, not a trend change.
I don't want to upset you, but:
- the screenshot above is not a trend (primary/secondary) at all, but just the last minutes before the week's close. These are swaps. They are stretched because the day/week ends and does not open everywhere at the same time
- the volumes in forex are not known at all.
- And so is the information on the trades.
- The thesis about the consistency of indices is about two specific indices. And it is related to the american stock market.
When God wants to punish a man, he takes away his mind.
It is sad to see all this.
It is not your fault that you do not understand the true laws of her majesty of nature, otherwise God or Allah, which I, by chance, uncovered and apparently should have kept quiet. I waited 10 years and finally decided to make them public. One could not have expected otherwise. Nature has only three functions with three parameters. By manipulating them it creates all imaginable and unimaginable laws and dependencies. I have them in my hands on three computers.
3 тенденции и 3 фазы тренда
The second and third tenet of the Dow theory has to do with market trends.
The market includes three types of trend. In the method, there is the concept of a market trend. The authors explain the concept as follows: a trend line is a price movement in which each new high is located higher than the previous high or a new low will have a location lower than the previous low.
Immediately an error... If we are to be logical, we will find that there are not three types of trends, but a little bit more, if we draw a trend using extrema, starting from the largest one and gradually decreasing the time. And it's not as linked to the times as Dow described... it's probably because
When he wrote his work, he did not have a metatrader, or else the technique prevented him from seeing everything thoroughly.
It is not your fault that you do not understand the true laws of her majesty of nature, otherwise God or Allah, which I, by chance, uncovered and apparently should have kept quiet. I waited 10 years and finally decided to make them public. One could not have expected otherwise. Nature has only three functions with three parameters. By manipulating them it creates every imaginable and unimaginable law and dependence. I have them in my hands on three computers.
You should first sort out which is the stock market and which is the financial market. They have completely different reasons for price formation. The TA for the stock market is different and for the financial market it is different. And combining them into one TA will not work.
Many, many years have passed since the Dow theory was developed. The world has accelerated and the theory in its original form has lost its relevance. Other laws are already working which were not seen by the developers of the Dow theory.
It will be commendable if you manage to improve the theory for today's realities).
It only remains to wish you success.
Immediately an error... To be consistent, by trending along extrema, starting from the largest and gradually decreasing the time, there are not three types of trend, but a bit more. And it's not as linked to the times as Dow described... it's probably because
when he wrote his work, he didn't have a metatrader, or else his technique prevented him from seeing everything thoroughly.
That's right. I was going to say the same thing, but you beat me to it.
Guys, don't you feel that you are guessing about real life on tarot cards without looking out of the window? And the real life is as follows - the quote for us in the terminals is transmitted by Globex, a member of the CME corporation, and the quote itself is born at the auction of the relevant futures CME and no other way, and the fables about 7 trillion at the OTC market and just 34 billion at the stock exchange, these are fairy tales for newcomers, with not squandered depot.
So maybe use your brain to do stock analysis and study the CME Daily Bulletin, to look at the real data and the real accumulation of strike volumes. Or maybe it is time to combine Dow theory and stock analysis, as the only one that operates directly with real data? ..... The Dow-Sultonov theory from year 11 did not see any BA.