Dow theory is a Study about the Stock Price Direction on Time vs price scale.It helps in knowing the Demand and supply levels.Dow theory is proven reliable method in knowing the price direction for Longer term.
When a stock makes a Higher Bottom and Higher Top then it is in Bullish Trend
Lower Top and Lower Bottom – Bearish Trend
By knowing the proper resistance and support levels one can plan the entries ,stop and exit in stock using by taking the Short or Long trades based on Dow Theory rules.
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Correction: What type of charts used, minimum look up period, duration of trend forecasting for Dow Theory?: For Dow theory mainly Minimum 32 year of line charts are used to identify major tops and bottoms.. Daily time frame is used on charts.