DOW THEORY

For dow theory, use daily charts – min. 2 years data required – daily line charts. First spot the tops and bottoms. Then qualify them as higher top , lower top, higher bottom and lower bottoms. Look for bullish trend which is Higher bottom-higher top – create a LONG position and bearish trend which is lower top-lower bottom – create a SHORT position…both trends need to be supported with a good volume. Never go against the trend, follow the trend.