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Criticism:
1. It is late in recognizing the trends and often investors end up reacting late than instantly.
2. It cannot be used for intraday.
3. It does not explain the characteristics of price behavior.
Stillmost of the modern day technical analysis are based on Dow theory hence it’s still remains on top.
The Dow Theory is one of the oldest and yet very effective also,
It is the basic concept to understand the Demand & Supply
The Major Critics regarding the Dow Theory is that, It becomes very difficult to understand the very next or
immediate movement of the price, As it not very much recommended to determine immediate Buy Or Sell levels
as they can be far in distance in terms of price and the reason behind that..
The Dow Theory is to determine the Trend in context with Demand & Supply in longer term perspective
And in fact that becomes its major unique point to remains on the top of any analysis
The Dow Theory is for understanding the Trend of the Market in context with
Demand & Supply rather then immediate price movement
Dow theory is used for only long term perspective not for shot term perspective. It is the strongest of all Long term analysis .It clearly derives demand and supply.
Criticism:
1. It is late in recognizing the trends and often investors end up reacting late than instantly.
2. It cannot be used for intra-day.
3. It does not explain the characteristics of price behavior.
Still most of the modern day technical analysis are based on Dow theory hence it’s still remains on top.
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