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The Dow Theory gives the trend ie positive or negative and does not say about the quality and the nature of the trend and we need to take 2 years of data to analyse and it is best suited for long term investment.
The price pattern gives the characteristics behind the price movement , takes the input from Dow Theory and gives early signals about the price behaviors. It requires min 2 months data and is very useful for short term investment.
Dow theory does not say the characteristic of the trading. We need to take 2 years data to analyze. For long term investment we can use this.
Price pattern gives the characteristic of price movement. This is useful for short term investment.
Price patterns helps to find the characteristic of the market and market direction, which Dow theory doesn’t give.
The Basic difference between price pattern and Dow Theory is the Time Frame
Because when we apply Dow Theory we need to open Daily Chart for at least 2 years in context with volume
and while considering price pattens we need Shorter Time frame some few months in context with volume
Though price pattern is also based on Dow Theory it can helpful in identifying Short Term Price Action
and it also helps us to define the characteristics of the Trend ..
Where else Dow Theory helps us to identify the Trend or direction of the market
Dow theory is most suitable for long term investments as it indicates only the market trend in a particular time frame
wheareas price patterns are the study of demand and supply to determine the characteristics of movements and gives a reason onto why the trend
In order to predict an early breakout point.
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