Dow theory uses the price and volume to identify demand and supply and determine top bottom higher top and bottom and lower top and bottom
Minimum 2 years are used in line charts
Higher top and higher bottom is uptrend and lower top lower bottom is downtrend
It cannot be used for short term and intra trade and still remains the top as it identifies bullish and bearish
Take 2 years of line charts and identify top bottom higher and lower tops and higher and lower bottoms . mark higher bottom and higher top which is bullish and create long position, lower top and lower bottom bearish and create short position
, , Dow Theory, 2 years, bearish, Bottom, bulish, dow, Higher Bottom, Higher top, Lower Bottom, Lower Top, resistance, support, Top
Hi,
Support and resistance represent key factor where the forces of supply and demand meet.As demand increases, prices advance and as supply increases, prices decline. When supply and demand are equal, prices move sideways as bulls and bears slug it out for control.