Mother of Technical Analysis-Dow Theory

Dow Theory is mother of technical analysis, it gave strong foundation and direction for further technical analysis. Studying Tops and Bottoms indicate the price behaviors over time. Line chart for 2/+ years gives anticipated direction for next 2-3 months. This is useful for swing, positional trading and long term investing. Confirmation of major indices, Price behavior, Volume, trend reversal and break outs are most important aspects of Dow Theory. Support and Resistance are confrontation areas where volume indicates the strength and sustainability. Elliot wave is further development of Dow Theory and is preferred. Candle sticks are very useful but only for short term. It gives lot of data that is most useful for near term perspective. Line chart considers close price and is relevant for long terms.