Experience Dow Theory intuitively through technical analysis
Technical analysis exists in countless forms when combined with indicators, but
in the end, they’re all just arrangements of indicators like moving averages
they’re only chasing ghosts of the past
so you should use indicators that forecast the future, like Dow Theory
from there, tweaks give rise to your own discretionary approach
finding your strong discretionary method is the holy grail and leads to capital increases
The turning line and baseline of the Ichimoku Kinko Hyo
MA leads
Envelope
These techniques tend to move in harmony with Dow Theory
The turning line and baseline of Ichimoku
are close to the breakout points described in Dow Theory
making them easy to treat as Dow Theory trend-following signals
Envelope provides signals at the initial entry point for a trend-following setup
and when used together with MA-leading
they can be viewed in terms of trend confirmation plus breakout following the trend
Among these, I think the ones I can use are
the turning line and baseline
Indeed, Envelope and MA-leading give signals early, but
because they’re early, the signals keep coming
In other words, there will be more losses, so I don’t think they’re suitable for day trading
(It might be effective if you change time frames and use them as short-term parameters)
However, with the turning line and baseline,
one could say that in a bad way they’re unfavorable in wide ranging, choppy markets
but in a good way you can make good use of a clean, strong trend
These clean, big trend markets have a tendency to gain momentum
Ultimately, most traders who are positioned are not viewing them from the turning line or baseline perspective
So, Dow Theory faithful indicators that suit long trends are easy to use
However, even as technical tools they require a bit of discretionary input
you’ll need to add some discretion to the technique
I think it would be good to add MACD to the turning line and baseline
Please try using it in trend markets
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