Dow theory is very useful for swing trading

When Demand > Supply, Buy the stocks.

When Supply > Demand, Sell the stocks.

  • : Dow theory was invented by Charles Dow in 19th century , Dow theory is a form of technical analysis used to understand market movement using demand and supply , which can be identified using price and volume
  • : Line chart with minimum 2 years duration and 2 months deadline
  • : Take Line chart with 2 years duration and mark the major tops and bottoms, and check the line pattern find the sequence of the chart If H.B and H.T its is bullish If L.T and L.B
  • : Dow theory provides only directional indication and only for the longer duration (2 Months) and does not indicate the shorter reflections in the market. But this theory is top of analysis, since it is proven for many years and good for deriving the trend easily.
  • : When Demand > Supply, Buy the stocks. When Supply > Demand, Sell the stocks.
  • : When the demand is greater than the supply, price increases and after reaching a zone the supply increases as a result the price falls. This zone is known as resistance. When the price falls supply is greater than demand it reaches a level were the demand increases and this zone is known as the support .
2 Comments
  1. Naresh 1 year ago

    Hi,
    Those of your content is neat and clear. Hope it will be useful to recall.

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