Dow theory

Dow theory was invented by charles H Dow in 19th century,he introduced to study the market to understand the market trend, and is based on demand and supply, by marking the higher bottom and higher tops for bullish, lower top and lower bottom for bearish.Line charts is used for dow theory, daily charts are required with minimum of 2 year data and the duration of trend is 2 months to forecast.dow theory is only to find the market trend, not for the price movement and for short term or intraday, its only for longer duration minimum of 2 months.by giving the idea of demand and supply volume.When Demand > Supply, Buy the stocks or If we find the sequence of Higher bottom and Higher Top, we can buy the stock as the trend is bullish.When Supply > Demand, Sell the stocks or if the sequence is formed by Lower top and Lower bottom, we can sell the stock as the trend is bearish