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How to pick trades in different market conditionsIn the video I look at two different markets and the resultant setups which yielded the prime trades. The two markets had to be approached in different ways, especially early in the session. I look through the price action on the DOW and then the Nasdaq. The DOW proved to be more clear cut and a trend style approach while the Nasdaq was very choppy and warranted a range or reversion style approach to the trades. Still, both were tradable and produced some good scalps although the action had to be recognised early. ANY QUESTIONS, JUST LEAVE IN THE COMMENTS !! ** If you like the content then take a look at the profile to get more ideas and learning material ** ** Any Comments and likes are greatly appreciated **
CBOT_MINI:YM1!Education
by TradeTheStructure
2
Trapped traders provides a great Short opportunity on DOW The plan for the session was to trade short off resistance on the DOW after an initial opening drive higher. The short side was the play and paid out nicely for patient sellers. In the video I talk through the key Price Action for the move and prime trade areas on the DOW Index. ANY QUESTIONS, JUST LEAVE IN THE COMMENTS !! ** If you like the content then take a look at the profile to get more ideas and learning material ** ** Any Comments and likes are greatly appreciated **
Editors' picks
CBOT_MINI:YM1!Education
by TradeTheStructure
4
DOW THEORY APPLIEDADA is showing one of the tenets of the DOW Theory. According to Dow, the market has three phases: 1) An accumulation phase 2) A public participation phase 3) A distribution phase The accumulation phase represents informed buying of the investors. The public participation phase is where the prices advance rapidly along with great news. In the distribution phase, the same "informed investors" who "accumulated" near the bottom begin to "distribute". Right now, we might expect a couple of months-long Accumulation Phase before any rally due to Public Participation. For more information on Dow Theory, you can read "Technical Analysis of Financial Markets" by Johny J. Murphy
Education
by Mr_Banker
Dow Theory: The Foundation of Financial MarketsIntroduction Dow Theory is the foundation upon which the edifice of technical analysis stands. Named after Charles H. Dow, co-founder of Dow Jones & Company and The Wall Street Journal, Dow Theory offers insights into market trends, investor psychology, and the broader economy. This article goes beyond the rudiments of Dow Theory to provide an in-depth understanding of its principles and application in modern market analysis and investing. The Genesis of Dow Theory The Dow Theory emerged from a series of editorials penned by Charles Dow between 1899 and 1902. He never compiled his ideas into a 'theory,' but after his death, followers and associates extrapolated his thoughts to give birth to the Dow Theory. Dow, a keen observer of market behavior, aimed to understand the relationship between the stock market and the economy. He hypothesized that the stock market is a reliable measure of the economy's overall health and believed it discounted all available information, including future expectations. The Cornerstones of Dow Theory Dow Theory is predicated on six basic principles: The Averages Discount Everything : All known and anticipated factors — economic, political, or psychological — are factored into the market price. The impact of unforeseen events, called 'Acts of God' by Dow, are usually short-lived and the market quickly adjusts to these. The Market Has Three Trends : Dow classified trends into three types based on duration: the Primary trend, which can last from less than a year to several years; the Secondary trend, corrective phases of the primary trend that last from three weeks to three months; and Minor trends, fluctuations within the secondary trend that last for a few hours to a few weeks. Primary Trends Have Three Phases : Dow identified three phases within a primary trend - the accumulation phase, where sophisticated investors start investing based on their economic analysis; the public participation phase, where trend-following investors join leading to substantial price changes; and the distribution phase, where the aforementioned sophisticated investors start offloading their positions, having recognized the market's peak or trough. The Averages Must Confirm Each Other : Dow stated that for a trend to be established, the Industrial and Transportation averages must confirm each other, i.e., they must reach new highs or lows simultaneously. Volume Must Confirm the Trend : Volume should increase in the direction of the primary trend. In a bull market, volume should increase when prices rise and decrease when prices fall. The opposite holds true in a bear market. Trends Persist Until Definitive Signals Prove They Have Ended : The final tenet of Dow Theory states that trends remain in effect until there are clear signals that they have reversed. Such signals are often seen in price patterns and technical indicators. Unpacking the Principles: A Deeper Dive Each of the above principles is predicated on the insights Dow derived from his years of observing the stock market. He understood that while individual stock prices may be influenced by company-specific news, the broader market reflects the aggregate sentiment of all market participants and, therefore, discounts everything — including future expectations. His classification of trends into primary, secondary, and minor was an acknowledgment of the different time horizons of investors. Long-term investors look at primary trends, intermediate investors at secondary trends, and short-term traders at minor trends. Dow's observation of market phases resulted in his classification of primary trends into accumulation, public participation, and distribution phases. This classification underscores the importance of market sentiment and psychological factors in driving price trends. The requirement for averages to confirm each other underlines the interconnectedness of different sectors of the economy. Dow believed that no significant bull or bear market could occur unless the industrial and transportation averages rallied or fell together. The principle of volume confirmation underscores the importance of investor conviction in sustaining trends. Rising volume in the direction of the trend signifies increasing conviction among investors. Finally, Dow's tenet that trends persist until definitive signals prove they have ended is an acknowledgment of market momentum and the fact that trends are more likely to continue than reverse. The Application of Dow Theory in Today's Market Dow Theory's principles can be applied in several ways: Trend Identification : Dow Theory helps identify the primary, secondary, and minor trends in the market. This can guide traders and investors in aligning their strategies with the market's dominant trend. Market Phase Recognition : By identifying the accumulation, public participation, and distribution phases of a primary trend, traders can gauge market sentiment and position themselves accordingly. Inter-market Analysis : The principle of confirmation between the Industrial and Transportation averages can be applied more broadly to inter-market analysis. For example, a simultaneous rally in stocks, bonds, and commodities might signal a strong bull market. Volume Analysis : Volume analysis can help confirm the strength of a trend. An increase in volume in the direction of the trend signals strong investor conviction. Trend Reversal Signals : Dow Theory can also help identify trend reversal signals. A divergence between price and volume, or between the different averages, can signal a potential trend reversal. The Relevance and Limitations of Dow Theory Today Dow Theory, despite being over a century old, is remarkably relevant today. Its principles form the basis for numerous trading strategies and technical analysis methods. The theory's focus on trends, volume, and the interconnectedness of markets is as valid today as it was in Dow's time. However, Dow Theory has its limitations. It is a lagging indicator, meaning it identifies trends after they have already started. It can also be subjective, as different analysts may interpret the market phases or trends differently. Furthermore, in today's globally interconnected markets, external factors such as geopolitical events or foreign market trends can influence U.S. markets, which Dow Theory does not account for. Despite these limitations, Dow Theory remains afundamental pillar of technical analysis. By understanding its tenets, traders can gain insights into market trends, investor psychology, and market phases. However, it is advisable to use Dow Theory in conjunction with other forms of analysis and not as a standalone trading system. By doing so, traders can obtain a more rounded view of the market, helping them to make informed trading decisions. Dow Theory in the Age of Algorithmic Trading and Machine Learning In the era of advanced technologies like algorithmic trading and machine learning, you might wonder how a theory developed in the late 19th century remains relevant. Interestingly, the principles of Dow Theory have been incorporated into many algorithmic trading systems and machine learning models used for market prediction. These advanced systems often use statistical and mathematical models to identify patterns that signify potential buying or selling opportunities. While these patterns might be based on sophisticated calculations, the underlying principles often align with the basic tenets of Dow Theory. For instance, machine learning models that use trend-following strategies essentially rely on the Dow Theory principle that markets have three trends. Algorithms that account for volume data to confirm a trend reflect the Dow Theory principle that volume must confirm the trend. Conclusion Dow Theory, while seemingly simple, is a profound and insightful study of market behavior. It provides a framework for understanding the forces that drive market trends, the role of investor psychology, and the interplay between different market sectors. In essence, Dow Theory is a study of market behavior at its most fundamental level. By understanding its principles, traders can gain a clearer perspective on the market's primary direction, the strength of that direction, and the potential turning points. While Dow Theory is not without its limitations and may not provide precise buy or sell signals, it is a valuable tool in the arsenal of traders and investors. When combined with other forms of technical and fundamental analysis, Dow Theory can provide a solid foundation for sound trading and investment decision-making. As the markets evolve and become more complex, the core principles of Dow Theory remain an essential guidepost. They serve as a reminder that despite short-term fluctuations, it is the broader trends that ultimately dictate the trajectory of the market. As with all trading strategies and theories, risk management is paramount. Dow Theory is no exception. While it provides an essential framework for understanding market behavior, traders must also employ robust risk management strategies to protect their capital. This includes setting stop losses, diversifying investments, and regularly reviewing and adjusting trading strategies in response to changing market conditions. In conclusion, Dow Theory has stood the test of time as a foundational pillar of technical analysis. It continues to provide valuable insights into market behavior, guiding traders and investors as they navigate the ever-changing landscape of the financial markets. As Charles Dow himself noted, "The one fact pertaining to all conditions is that they will change." With its focus on trends and changes, Dow Theory remains an indispensable tool for making sense of these changes and predicting future market direction. Hope this helped, if you have any questions, feel free to leave them in the comments!
BITSTAMP:BTCUSDEducation
by BiggWigg
2
Trading week recap for NASDAQ, DOW, DAX & FTSE (01/07/2023)We had successful trades with the NASDAQ and the DAX. Let's look back at the past trading week and learn from it. What went well? What could be better? This is an experiment. Educational content to become a good waver. If you like this video, please let me know by commenting. Any suggestions? Please let me know. Something went wrong with the recording for the last part on the FTSE. We continue the analysis on Monday.
OANDA:NAS100USDEducation
by AndyCuckoo
DOW JONESDow Jones Industrial Average is the oldest index in the world. The index always shows what is happening with the US economy - the largest economy in the world. Let's look at the chronology of important economic events since 1916: 1916 Lusitania - Sunk by German Submarine / Emergency Revenue Act - Includes Estate Tax 1917 US Formally Declares War on Germany 1918 World War I - End / Daylight Savines Tima / Amendment, Prohibition - Ratified 1919 Amendment, Women's Suffrage - Ratified 1921 The First Restrictive Immigration Act 1922 Federal Narcotics Control Board - War on Drugs 1923 First Transcontinental Fight Japan Earthquake 1924 Ford Manufactures 10 Milfionth Automobile - Scopes Monkey Trial 1926 Revenue Act - Reduces Income & Estate Taxes 1927 Lindbergh - First Nonstop Flight - New York to Pacis 1928 Amelia Earhart - First Woman to Fly Atlantic 1929 Financial Panic - Stock Market Crash - Depression 1930 Smoot Hawley Tariff Act 1931 Bank Panic - Countrywide Banks Closings 1932 Lindbergh Kidnapping / Reconstruction Finance Corp 1933 The New Deal - FDIC Established 1934 Securities & Exchange Commission - Established 1935 Social Security Act - Passed 1936 Drought in the Western States - Dust Bowl 1937 Hindenburg - Destroyed 1938 The New Deal - End / Fair Labor Standards Act 1939 World War Il - Begins in Europe / Great Depression 1940 France Falls - German Occupation 1941 Peart Harbor - Attacked by Japanese 1942 Price Controls - Begin / Battle of Midway / Guadalcanal 1943 Current Tax Payment Act, Withholding Taxes 1944 Normandy Invasion 1945 World War II - End / Cold War - Begins 1946 Stock Market Crash / Price Controls - End 1947 Taft-Hartley Act / Marshall Plan 1948 Truman Upsets Dewey - For Presidency 1949 Foreign Currencies Devalued 1950 The Korean War - Begin 1951 First Commercial Color TV Broadcast 1952 Steel Workers Strike - Despite Government intervention 1953 The Korean War - the End of Wage Stabilization Board 1954 St. Lawrence Seaway Bill - Passed 1955 President Eisenhower - Suffers a Heart Attack 1956 Suez Canal - Crisis 1957 Sputnik | 1958 USA - First Satellite Launched 1959 St Lawrence Seaway - Opened 1960 First Japanese Cars, Exported to US / U2 Spy Plane Shot Down 1961 The Berlin Wall - Built / Bay of Pigs - Debacle 1962 The Cuban Missile Crisis / Sled Price Rollback 1963 John F. Kennedy Assassinated 1964 Vietnam War Begins - Gulf of Tonkin Resolution 1965 The Great Inflation - Begin 1966 Medicare - Begin / the First Time USA Bombs North Vietnam 1967 The Six-Day War 1968 The Offensive / R.F. Kennedy & M.L King - Assassinated 1969 Apollo 11 - the USA on the Moon 1970 USA & South Vietnamese Invade Cambodia | Kent State 1971 Wage & Price Controls 1972 Watergate - Break-in / Munich Olympics Massacre 1973 US Involvement in Vietnam - End / Arab Oil Embargo 1974 President Nixon Resigns / ERISA Act - Signed 1975 Saigon - Fall / May Day - the End of Fixed Commissions 1976 US Bicentennial / Lockheed Aircraft - Bribery Scandal 1977 Panama Canal Treaty - Control of Panama in 2000 1978 Humphrey-Hawkins Full Employment Act 1979 Three Mile Island - Accident / Iran Hostage Crisis 1980 Iraq Invades Iran - War / Hunt Brothers Siver Crisis 1981 Tax Cut - Passed / Space Shuttle / President Reagan - Shot 1982 Penn Square Bank - Closed by Regulators / Falkland Islands War 1983 Terrorist Bombing of US Barracks - Beirut / Grenada Invasion 1984 Run on Continental Bank 1985 Gramm-Rudman Act / US Becomes a Debtor Nation 1986 Iran-Contra Affair / US Attacks Libya / Chernobyl Accident 1987 Financial Panic / Stock market Crash of Iraq Attacks on USS STARK 1988 Terrorists Bomb N.Y. Bound Airliner - Lockerbie, Scotland 1989 The Berlin Wall - Opens / US Invades Panama 1990 Iraq invades Kuwait / Gorman Unification 1991 The Gulf War / Soviet Union Collapse 1992 The Cold War - Ended / Civil War in Bosnia 1993 Russian Revok / World Trade Center - Bombed 1994 Orange County Bankruptcy of NAFTA instituted 1995 Oklahoma City - Murrah Federal Building - Bombed 1996 Alan Greenspan's “Irrational Exuberance” Speech 1997 Asian Currency Crisis - Hong Kong & Global Stock Market Rout 1998 US embassies in East Africa bombed 1999 NATO Bombs Serbia, Yugoslavia / Y2K - Millennium Scare / Columbine massacre 2000 Bush v. Gore Election Crisis / Terrorist Attack on USS COLE 2001 Terrorist Attack on the World Trade Center & Pentagon / Enron 2002 War on Terror of Turmoil in the Middle East / Corporate Misconduct 2003 Iraq - Weapons Inspections / War in Iraq 2004 Global War on Terror 2005 Record High Oil Prices / Hurricane Katrina 2006 Housing Decline / Nuclear Weapons - North Kores & Iran 2007 Subprime Mortgage / Credit Debacle 2008 Credit Crisis / Financial Institution Failures / Bitcoin - Created 2009 War on Terror / Climate Debate / Healthcare 2010 Gulf Oli Spit / European Union Cassis / Massive Debt 2011 Debt Ceiling Crisis / US Credit Downgrade 2012 European Debt / US Fiscal Cliff 2013 Boston Bombing / Government Shutdown / NSA Leaks 2014 Rise of ISIS / Police Protests / Oil Price Decline 2015 Terror Attacks / Refuges Crisis / China Slowdown / Fed Rate Hike 2016 Brexit - Start / Cuban Embassy Opened / Elections 2017 Trumponomics, Cryptocurrency Fever 2018 United States trade war with China 2019 Chang'e-4 on the far side of the moon / Fire of Notre Dame Cathedral / The first case of 2019-nCoV coronavirus infection in China 2020 US-Iran Tension / The COVID-19 Pandemic / Joe Biden Wins the Presidency / "Black Monday" for oil / Brexit - End / SpaceX space launch 2021 The GameStop short squeeze / Ever Given halts global supply chain / COVID-19 vaccines / America withdraws from Afghanistan 2022 Ukraine Russia War in the Center of Europe - Sanctions for Russia What awaits us next... Potential events that may overtake us in the near future: - The use of tactical nuclear weapons. - Cyber Warfare. - Hunger. - The largest economic crisis (food crisis, trade supply crisis, energy crisis). - New viruses, pandemics. - Potential formation and formation of Kurdistan and conflicts around it. - Massive Blackout. - Conflicts of countries in Oceania. Write in the comment section what you would add to the list above. Best Regards, EXCAVO
Editors' picks
DJ:DJIEducation
by EXCAVO
186
Get ahead of the Game of Crypto with Dow TheoryWelcome to @TradingView , this is @Vestinda! We're excited to share with you our insights on the Dow Jones Theory and how it can benefit cryptocurrency traders. Dow Theory, also known as Dow Jones Theory, is a trading strategy developed by Charles Dow in the late 1800s. Charles Dow did not write any books during his lifetime, but he did co-found The Wall Street Journal and the Dow Jones & Company. He also wrote many editorials for The Wall Street Journal. Here is a quote from one of his editorials that is particularly insightful: "The successful investor is usually an individual who is inherently interested in business problems." Dow theory continues to dominate and is regarded as one of the most sophisticated contemporary studies on technical analysis even after 100 years. What exactly is Dow Theory? Charles H. Dow compared the stock market to the tides of the ocean in the Wall Street Journal on January 31, 1901. "A person watching the tide come in and wanting to know the exact location of the high tide places a stick in the sand at the points reached by the incoming waves until the stick reaches a position where the waves do not come up to it and finally recedes enough to show that the tide has turned." This method is effective for observing and predicting the flood tide of the stock market." Dow believed that the current state of the stock market could be used to analyse the current state of the economy. The stock market can provide valuable measures for understanding the reasons for high and low trends in the economy or individual stocks. How Does the Dow Theory Work? The Dow Theory is based on several fundamental tenets, which are outlined below: 1. The Averages Reflect Everything: The market price takes into account every known or unknown factor that may impact both supply and demand. According to this observation, the market reflects all available information, even information that is not in the public domain. However, natural disasters such as droughts, cyclones, floods, or earthquakes cannot be considered. Major Geopolitical Events are Already Priced In: All significant geopolitical events, trade wars, domestic policies, elections, GDP growth, changes in interest rates, earning projections, or expectations are already priced in the market. Unexpected Events Affect Short-Term Trends: While unexpected events may occur, they usually only affect short-term trends, and the primary trend remains unaffected. Overall, the Dow Theory emphasises the importance of analysing the primary trend of the market and understanding that all available information is already reflected in the market price. 2. The Market Has Three Trends: The primary trend: It can be as long as one year to several years and is the ‘main movement’ of the market. These movements are typically referred to as bull and bear markets. This primary uptrend is called as bullish on the other hand primary downtrend can be considered as bearish trends. The reality of the situation is that nobody knows where and when the primary uptrend or downtrend will end. As you can see in the image above when a stock is moving in primary uptrend it makes new high followed by few lows not lower than the previous lows. Similarly the same patterns follows when it is in primary downtrend. The objective of Dow Theory is to utilize what we do know, not to make chaotic guess about what we don’t know. Through a set of guidelines from Dow Theory one can measure to identify the primary trend and stay with it. The intermediate trend or secondary trend: This trend can last between 3 weeks to several months. Secondary movements are reactionary in nature, think of them as corrections during bull market, or rallies & recoveries in the bear market. In a bull market, a secondary trend is considered a correction. In a bear market, secondary trend are called reaction rallies. So suppose if a stock during its primary uptrend made a high, it will retrace back to some points to make a low (known as intermediate trend or correction). Likewise during an primary downtrend, a stock can make a high after falling for several months or years(known as bear market rallies). The minor trend or daily fluctuations: This trend is least reliable which can be lasting from several days to few hours. Dow theory suggests not to put much attention to these trends. As a Long-term investor it is just the part of corrections in secondary uptrend or downtrend rally. This are just daily fluctuations happening in market on day to day basis. It constitutes of noise in market and perhaps be subject to manipulation. Out of the three trends mentioned only primary and secondary trends are trustworthy. However, the study of daily price action can add valuable insight, if you look in context of the larger picture. So when you are looking for daily price action of several days, or weeks try to evaluate bigger structure getting formed. By putting enough attention one can certainly benefit in short term rallies. A few pieces of a structure are meaningless, yet at the same time, they are essential to complete the entire picture. 3.Major Trends Have Three Phases: Dow significantly paid attention to the primary trends (major) in which he spotted three phases. These are Accumulation phase, Public participation phase and Distribution phase. These phases are cyclic in nature and repeats over the time. A) Accumulation phase: This phase occurs when the market is in bearish trend, sentiments are negative with no hope for any upcoming uptrend. For example as we saw in Indian share market a steep low in mid cap stocks, making new lows every other day. Most of the investors see them stay in this trend for unknown time period. However, this is the time when big investors, huge fund houses, institutional investors start accumulating them gradually. This is known as smart money keeping their view for long term investment. Although you would see sellers in market still selling, they find the buyers easily. B) Public participation phase: At this phase the market have already absorbed the negativity with ‘smart money’ getting invested. This is the second stage of a primary bull market and is usually sees the largest advance in prices. During this phase majority of public(retailers) also thinks to join in as the price is rapidly advancing. However most of them are left behind due to speed in rallies as well as the averages start heading higher. If you are also a trader or investor you might have this experience and a regret of not able to participate with rally. It is a period followed by improved business conditions and increased valuations in stocks. C) Distribution phase: The third stage is the excess phase which eventually be turned to distribution phase. During the third and final stage, the public (retailers) gets fully involved in the market, as they get mesmerized by the bull market rally. Some of them who felt left will still try to look for valuations and want to be part of the rally. But this is the time when ‘smart money’ starts liquidating shares on every high. Whereas public will try to buy at this level absorbing all liquidating (sell-off) volumes made by big investors. On contrary in the distribution phase, whenever the prices attempt to go higher, the smart money off loads their holdings. This is the beginning of bear market, where sentiments will start turning negative, you will see more and more companies filing bankruptcy, change in economic growth etc. During bear market the level of frustration rises among retail investors as they start loosing all hopes. 4.The Averages Must Confirm Each Other: Dow used to say that unless both Industrial and Rail(transportation) Averages exceed a previous peak, there is no confirmation or continuation of a bull market. Both the averages did not have to move simultaneously, but the quicker one followed another – the stronger the confirmation. To put it differently, observe the image above, as you can see both the averages are in bull market, trending upward from Point A to C. 5. Volume Must Confirm the Trend: Volume is a tool to know how many shares have been bought and sold in a given period of time. It helps in analysing the trends and patterns. Now according to Dow theory, a stock must be in uptrend with high volume and low in corrections. Volumes may not be an attractive piece of information but you should try to combine the volume data with resistance and support levels to get a clear picture. 6. Trend Is expected to Be Continued Until Definite Signals of Its Reversal: Quite similar to Newton’s first law of motion which states that an object will remain at rest or in uniform motion in a straight line unless acted upon by an external force. In simple words an object will remain in their state of motion unless a external force acts to change the motion. Likewise, the market will continue to move in a primary direction until a force, such as a change in business conditions, is strong enough to change the direction of this primary move. You can also see the signals for reversals when a trend is about to change. 7.Signals and Identification of Trends: One of the major challenges faced while implementing Dow theory is the accurate identification of trend reversals. Remember, if you are following the dow theory one should be not only looking for overall market direction, but also the definite reversal signals. One of the main skill used to identify trend reversals in Dow theory is peak and trough or high and low analysis. A peak is defined as the highest price of a market movement, while a trough is seen as the lowest price of a market movement. Dow theory suggests that the market doesn’t move in a straight line but from highs (peaks) to lows (troughs), with the overall moves of the market trending in a direction. An upward trend in Dow theory is a series of successively higher peaks and higher troughs. A downward trend is a series of successively lower peaks and lower troughs. 8. Manipulation In the Market: According to Charles dow the manipulation of the primary trend is not possible. where as Intraday, or day to day trading and perhaps even the secondary movements could be vulnerable to manipulation. These short movements, from a few hours to a few weeks, could be subject to manipulation by large institutions, speculators, breaking news or rumors. There is possibility that speculators, specialists or anyone else involved in the markets could manipulate the prices in short run. Individual shares could be manipulated for example the security rise up and then falls back and continues the primary trend. With this in mind one need to be aware of the situations while trading and investing. However, it would be next to impossible to manipulate the market as a whole. The market is simply too big for any kind of manipulation to occur. Why Dow Theory Is Not Infallible? Dow Theory is not a sure-fire means of beating the market hence it is not something which is infallible or fault-less. Some of the criticism received about Dow Theory is that it is really not a theory. Charles Dow's principles and theories, while developed for the stock market, can still be applied to crypto investing. Here are a few ways his knowledge can be used: Follow the trend: Dow's first principle is that the market moves in trends. In crypto investing, you can identify trends by looking at price charts and technical analysis. If the price of a particular cryptocurrency is in an uptrend, it may be a good time to consider buying. If it's in a downtrend, you may want to consider selling or waiting for a better entry point. Consider market breadth: Dow's second principle is that the market's movements should be confirmed by market breadth. This means looking beyond just the price of one cryptocurrency and examining the overall health of the market. For example, if a particular cryptocurrency is in an uptrend but the majority of other cryptocurrencies are in a downtrend, it may not be a sustainable trend. Use volume as a confirmation: Dow's third principle is that volume should confirm the trend. In crypto investing, volume can provide insight into the strength of a trend. For example, if the price of a cryptocurrency is increasing with high volume, it may indicate a strong uptrend. On the other hand, if the price is increasing with low volume, it may not be a sustainable trend. Be aware of market cycles: Dow's fourth principle is that the market moves in cycles. This means that there will be periods of growth and periods of decline. In crypto investing, it's important to be aware of these cycles and adjust your strategy accordingly. For example, during a bull market, you may want to focus on buying and holding, while during a bear market, you may want to consider shorting or staying on the sidelines. Overall, while the crypto market is different from the stock market, many of Dow's principles can still be applied to crypto investing to help you make more informed decisions. In conclusion, Dow Theory, developed by Charles Dow in the late 1800s, remains one of the most respected theories in financial market history. The theory's primary tenets are based on the idea that the stock market reflects all available information, and there are three trends in the market: primary, intermediate, and minor. The primary trend is the most important and can last several years, while the intermediate trend and minor trend are reactionary in nature. Dow Theory provides an excellent framework for traders and investors to evaluate the current state of the economy, and it has remained relevant even after 100 years. Whether you are an intraday trader, a short-term trader, or a long-term investor, the knowledge of Dow Theory will undoubtedly help you develop various strategies for your investments. So, in conclusion, Dow Theory is a respectful theory that has stood the test of time and continues to be an essential tool for anyone who trades or invests in the financial and crypto market. Unleash Your Inner Trader — Read Story About Bulls and Bears That Will Change Your Mindset! Hey there, our lovely friends! 😊 If you enjoyed reading this, please hit the "like" button 👍 and share it on your social media and groups. By doing so, more people can discover this interesting information, and we'll be encouraged to create even more awesome content for you! ♥️
Editors' picks
TVC:DJIEducation
by Vestinda
15
How NOT to loose money, 1st do not trade people's ideas do your Home work, do your research and learn learn learn till you become aware of what is going on in mkts and then being able to choose the right path for your and being able to distinguish right ideas and analysis from the wrong ones. *****Passing this cool info (Not mine) : 2. Set realistic expectations When you're investing, your expectations of what you could earn should be realistic. And sometimes, measures like average rates of return can be misleading. For example, if you invested in large-cap stocks between 1926 and 2020, you would've earned an average rate of return of 10.2%. And if you earned this rate of return over 30 years, $100,000 invested would've grown to $1.84 million. But during that same time period, you would've earned a high of 54% in 1933 and a low return of -43% during 1931. If you invested for the first time during a year of losses, it could make you wary of investing. Understanding that your returns won't be linear but instead, an average of positive, negative, and flat returns is important. And understanding this may help you withstand the bad years. 3. Know the difference between a realized and unrealized loss When you look at your account balance and see that it's lower than it was the month before, it may feel as if you've lost money. But the numbers you see on your statement or when you log in to your account are called unrealized losses or gains. These numbers change for better or worse throughout a day of stock market activity and are only considered actual losses or gains when you realize them by selling your holdings. For example, if your account balance was $10,000 last month and you experienced losses this month, it may now be worth $9,000. But you would only lose money in reality if you sell this investment before it gets back to its original value. Over the long term, the stock market has always increased in value, and your investments should, too, as long as you stay invested. 4. Have an appropriate time horizon How soon you need your money could impact how well you keep your money invested during stock market crashes. If you won't need your money for 25 years and you suffer a 30% loss, you may shrug it off knowing that your account value could return back to that value in a few years. But if you plan on using the money next year, you may panic at the idea of losing any of it. Before you invest one penny, think about your time horizon. And the closer it is, the more conservatively you should invest. Without the threat of missing your goal looming over your head, losses may not seem so devastating, and you'll be less likely to give up on investing due to a short-term drop. 5. Control emotions Controlling your emotions is no easy task, and when you're losing money, it can feel like it will go on forever. But declines have never lasted forever. Learning how you can control your emotions when you're feeling this way can be the difference between experiencing subpar returns that lag benchmarks or keeping pace with them. When you feel as if the sky is falling and it seems as if there's no end in sight, revisiting stock market corrections of the past can be helpful. Even during some of the periods of the most extreme losses, investors who stayed the course often recouped their losses within a few years. From 2000 through 2002, if you'd invested only in large-cap stocks, you would've lost about 38% in total. If you had $100,000, it would've decreased to around $62,000. But by 2006, you would've regained all of your money and been ahead slightly.. 6. Invest in line with your risk appetite How do you feel about volatility? Do you barely notice it and realize that it's a normal part of a market cycle? Or does it make your stomach drop every time it happens? You can earn more over the long term if you have more aggressive investments, but in a year of losses, these types of investments could also lose more money. And if the losses seem too big, these investments may be too risky for you. If this happens, staying invested may be harder. Making sure that you're invested in line with your risk tolerance can help you prevent this. You should also find an asset allocation model that suits your appetite for risk, even if it yields a lower average rate of return. Investing should help you meet your goals instead of putting you further away from them. While your account value increasing or decreasing regularly is normal, you don't have to lose money. And controlling your fears, making sure you hold suitable investments, having realistic expectations about how your accounts will grow and the time frame in which those gains will happen can help you avoid it.
SP:SPXEducation
by samitrading
2
Dow Theory simple introduction For those of you not familiar with Dow Theory. Here's a simple introduction. Nothing technical just a "welcome to" type of educational post. Short History Dow Has 6 Rules - these are known as the 6 Tenets Dow is mostly known (most obvious - the Dow Jones Industrial Average) Other tools and techniques can fit into the Dow Theory, such as Elliott and Wyckoff. Wyckoff "Buy me now" moves. As for Wyckoff - volume is and was a factor for the Dow Theory; Volume should increase in the direction of the trend in order to give confirmation. It is only a secondary indication but Dow realized that if volume didn't increase in the direction of the trend, this is a red flag. This means that the trend may not be valid. As basic wave principles apply - Dow simplified the inner workings of the market with the 6 tenets. He also came out with some brilliant quotes such as "Money is made by conservative trading rather than by the effort to get large profits by taking large risks." And “A person watching the tide coming in and who wishes to know the exact spot which marks the high tide, sets a stick in the sand at the points reached by the incoming waves until the stick reaches a position where the waves do not come up to it, and finally recede enough to show that the tide has turned. This method holds good in watching and determining the flood tide of the stock market.” ====================================================================================================================================== Dow theory trading strategy Most trading strategies used today hinge on one key concept, the "trend". This was a novel idea when Charles H. Dow published his writings at the end of the 19th century. Dow theory says that the market is in an upward trend if one of its averages goes above a previous important high and is accompanied or followed by a similar movement in the other average. Therefore, a Dow theory trading strategy is based on a trend-following strategy, and can either be bullish or bearish. So although the times have changed, human nature and the basic principles have not. Some of the theory can easily be applied to instruments such as commodities, Forex and crypto. As I said, this is not a lesson on the trading with, it was more an intro to. Worth some additional research, there are some very interesting books on the subject. Wyckoff basics part 2 )click the image link) Disclaimer This idea does not constitute as financial advice. It is for educational purposes only, our principle trader has over 20 years’ experience in stocks, ETF’s, and Forex. Hence each trade setup might have different hold times, entry or exit conditions, and will vary from the post/idea shared here. You can use the information from this post to make your own trading plan for the instrument discussed. Trading carries a risk; a high percentage of retail traders lose money. Please keep this in mind when entering any trade. Stay safe.
TVC:DJIEducation
by Mayfair_Ventures
10
Dow Jones 1930 Breakdown of the trend -81% Update after 25 yearsA similar situation is happening now. Then a breakthrough of the uptrend line, price fixing below the uptrend line and another -81.5% market fall. Previous highs were updated only after 25 years. The situation on the Dow Jones now. A very similar schedule as in 1930. It is important how the price will react near the uptrend line, which will act as a support. If there is a breakdown of the uptrend line and the price consolidates below it, a very dangerous situation will arise like in 1930 and a complete collapse of the US economy. Let's hope this does not happen. My former trading idea is an indicator. Published in April 2019. Which gave a signal of a market reversal before its fall. The relationship of the Dow Jones and the Fed% rate We are ahead of the financial crisis.
TVC:DJIEducation
by SpartaBTC
8
What's A Bear Market? Most Define It As a 20% DrawdownThis chart shows the Dow Jones Industrial Average after today's sell-off. In this published idea, we want to take a second to write about bear markets and what they mean. In the media, bear markets are officially defined as a 20% drawdown from a prior peak. Today, the Dow Jones Industrial Average closed down 20% from its prior peak. Technically, this means the market is officially in a bear market. There are some interesting stats, however, that show this definition has its flaws. For example, since the 1940s, the stock markets has dropped 20% or more 16 times and only 7 of those have turned into recessions. Sometimes, a 20% drawdown is just that... a 20% drawdown without a prolonged bear market that eventually leads to a full on recession. This post is not making any assumptions or directional predictions. Instead, we wanted to share a chart with everyone showing the official 20% drawdown in the Dow Jones Industrial Average while also providing more context about market panics and crashes. Thanks for reading and press Like if you enjoyed this or leave a comment with your thoughts.
TVC:DJIEducation
by TradingView
2
DOW JONESDow Jones is the oldest index in the world. This index always shows what is happening with the US economy - the largest economy in the world. Soon can be a new crisis and the question why this is happening? people will have many answers But I'm not talking about that Each crisis created new technologies and new companies, and the people who created or invested or participated in this are rich. Companies created in crisis 2007-2008 Blizzard Whatapp Airbnb Uber During the dot-com crisis and the Russian crisis Amazon Ebay Netflix Google EXON 1991 Idex Eccenture 1980-1982 AT&T Adobe 1973-75 Apple Microsoft 1969-71 Starbucks 1960-61 Humana 1937-38 Macdonalds The crisis is changes, changes in the consumption model, transition to a new stage of evolution, in the next crisis, someone will lose their jobs, and someone will create large multi-billion dollar companies 2008-2009 and Bitcoin are very good examples of this. I’m sure that Satoshi understood the flaws of the financial system. and created bitcoin which is devoid of these flaws. Create whatever Best Regards EXCAVO And thank you Kris Kacher
TVC:DJIEducation
by EXCAVO
39
How to Read Pennant Price Action More AccuratelyWe're all here on TV for the same reason, to become better traders and to make money. I came across this tip not too long ago and found that it really helped me read the price action better within pennants, so I wanted to share it with the community. Pennants form after a strong movement in price (either up or down) where the price bounces back in forth in a small area before it has to make a decision of where to go. The rule of thumb with pennants is they tend to break out in the same direction they were entered. This is often referred as a continuation pattern, where the price continues in the same direction it was heading. If the price was heading up, it will more likely than not break out to the upside and continue upward and vice versa. However, I noticed many times pennants not following that rule and I paid the price for being complacent in my trade. That was when I got this tip from Francis Hunt (highly recommended analyst) and it has really helped in anticipating where the price action is headed. Looking at WRX, notice how the price has strong spikes up in the price, followed by slow sell offs? This is bullish price action where the buyers are in control and it often leads to breakouts to the upside. I am merely using this price action as an example. WRX is a newly listed coin on Binance that did 9x in its first couple days on the exchange, so take this example more for the price action behavior than as evidence that it is going to explode to the upside. Now look at the pennant I have to the right of that. It entered the pennant on a bullish breakout so the price should continue in the same direction right? Well take a look at the price action inside the pennant. Notice the difference in how the price is reacting? In this case, each time the price slowly rises and is met with a sharp fall. This is an indication that the sellers are in control and you should be cautious of a strong breakout to the downside. I hope this tip helps you gauge your future trades into pennants more accurately. I have found that it has helped me dodge some sharp falls and take advantage of some big gains. I suggest you start searching the charts and analyzing the price action within those pennants to see if you notice this pattern as well. I hope it serves you as well as it has served me.
WEducation
by jpbrown1023
2
Dow 1932 Market Bottom, Parabola, What Can Be LearnParabola exists in almost everything. The boom and bust cycle always exist even things that is not related to economics. So, it is important to understand the existences of Parabola and how to make money from Parabola. Looking through data of hundred of stocks and assets for the past hundred years indicate the presence of Parabola or Parabolic Move. For example, Dow first Major Parabola peaked in 1929, that's since the inception of Dow. And by default, the assumption is always that after the parabola, then crash, then a formation of a BIGGER parabola in the future. That has always been the assumption since the world population is growing and economy will EVENTUALLY recover and grow. Plus, the whole financial system is DESIGNED to be INFLATIONARY and so money purchasing power declined over time. That is another reasons why stock market is going up over the long run, sometimes in Parabolic fashion. Why do many people miss out in a bull market? Because they make the wrong ASSUMPTIONS about market. The first major assumption is that stock market has always been going up over the long run. Because that's how money works, how capital works. Just ask yourself question, where do smart money put their money? In something. And whatever the thing smart money is putting on is what going up. During the Great Depression of the 1930's. dow rallied 400% from 1932 bottom to 1937 top, and then forming another 50% correction before grinding higher and higher and higher. This is one of the characteristics of EARLY PARABOLIC FORMATION, it has always been slow and very volatile. The market is very INDECISIVE and people always often sell the rally and go back to cash. It continue like this until eventually the Parabola is ready for its major move, which begins in 1950 for Dow Jones, then it will move much faster. However, this parabola is a bit weak and didn't throw away all its forces, peaking in 1966 and then stay sideway for another 14 years until 1980 while commodities and Gold are making its own parabolic move. which indicates a shift in capital and capital flow into something else during that time. That obviously can happen, but yet again, due to the sideway market of the 70's, most people miss out on the 1980-2000 bull market and parabolic move, because yet again, by default, people always assume that market will crash and we will go back to great depression. Parabola works until it doesn't, and it is much better for the whole market to go up over the long term, because if the market crashes, then it will be great depression and not the time you want to live. Parabola is the only way to make a lot of money and to become rich, and has been demonstrated by all the big gains in innovation and disruption. Tesla is latest example of Parabola. It is not that hard to make money in Parabola, buy the dips and follow the trend until it is over or reach its blow off/melt up phase. Which means either going long or holding cash. But most people insist on doing short term trading to make a lot of money. I wish people can be more long term minded and see the obvious thing, but not, people are too short sighted. This current parabola in the US stock market will be missed by many people and many people will miss out on the big gains by disruptive and innovative companies, just as they missed out on all the 100 baggers or more for the past 100 years.
DJ:DJIEducation
by UnknownUnicorn735418
Why Most People Don't Get It When It Comes to Capital FlowIt is mind boggling for me to see how many people just don't get it when it comes to capital flow. They don't look at the trends and seeing things that are obvious. In fact, they would rather try to time the market precisely and try to "short the top". They said that this is a bubble, the bubble will eventually pops and only Gold will go up. Well, Gold has been underperforming the stock market for the past 8 years, when will Gold rally? Gold will tell us. Regardless, cheap money are still there, money printing will continue and it will affect the capital flow. As simple as that, too much money floating around, it will flow somewhere. Amongs the stupidest thing that I have heard from the people in the crypto space is that the stock market needs to crash if Bitcoin is going to go up. They don't understand that Bitcoin and Crypto NEEDS stock market to GO UP in order to GO UP. That's why I was bullish ON BOTH stocks and crypto in 2017. Because it is SO SIMPLE and OBVIOUS, but people just don't get it. Bitcoin can't and will not go to 100,000 because of normal mom and pops. Bitcoin needs whales and whales need more capital to inject in order to operate properly their scheme and operations. I am sorry for all the Bitcoin maxis, but Bitcoin is heavily manipulated. I don't really have high expectations other than making some money and buy some lands to do my own farming. People are too obsess and fall in love with one particular asset and that the reasons why they keep losing money. Anyways, US stocks are going up, and once capital has done flowing into the blue chips, it will start to flow into the riskier stocks, small caps and then lastly crypto. Crypto will recover and made a bottom here, there is too much money floating around and that money will come back. That's why you are seeing some altcoins are pumping like crazy. But people still listens to youtubers who pretends to know everything. Feeling sorry for them and feeling sorry for all the sheeps. Open your mind and use your intellect, human brains are more intelligent than you can imagine. Stop being too philosophical and idealogical. The world is doomed anyways, just try your best to survive and do something useful/beneficial in life. Short term trading are not one of them. Find meaning in life, and stop focusing on materialism, it will no bring you anywhere. Be self sufficient and independent. I am glad that I am from so called third world country where we are still doing the farming ourself.
DJ:DJIEducation
by UnknownUnicorn735418
1