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Sunday, January 1, 2012

My Understanding about the Dow Theory


Why I was insisting DJIA has a small upward bias for 2011.
It was all about Dow Theory. In fact, I have posted a lot of times, referring to 1987 crashed and look what we got.
After Rhea's death, Dow Theory fell into less competent hands. Men who failed to grasp the essential principles of the theory misapplied and misinterpreted it, to the point that it is now generally considered dated and of little use as a technical tool in the modern markets. This is simply not true. I performed a study applying Dow Theory's principles to the Industrial and Railroad (later Transportation) averages from 1896 to 1985 and found that Dow Theory tactics accurately captured an average of 74.5% of business expansion price movements and 62% of recession price declines from confirmation date to market peaks or bottoms, respectively.

V. Sperandeo

2 comments:

Anonymous said...

hi sir tracer. i remember you showed us a sunshine or was it the moonshine chart? (i forgot the name, sorry) any update on that?
thanks.

About tracer said...

it is still valid up to 2015, have note reposted it since it is a bit off target.