Dow Theory is used for studying the Demand and Supply of the stocks.
Open daily (line) chart for minimum 2years. Mark all significant tops, bottoms, further plot higher top, higher bottom, lower top, lower bottom
Buy and create a long position when the market crosses Previous top ( with High Volume) and retain the position. Sell and create short position when it goes down the previous bottom. ( with High Volume) only if the trend is HB HT (bullish) & LT LB ( Bearish).
Support level refers to the price level below which, a stock has had difficulty falling.
Resistance level refers to the price level above which a stock has had difficulty rising.