Dow Theory. After all, Dow Theory. The beginning is the most important part. It’s the foundation, the basics.
First, I would like to apologize.
To catch your eye, I deliberately chose a strong title.
If someone felt uncomfortable, I’m sorry.
However, in this article, I intend to deliver what is essential, clearly.
I would be grateful if you read to the end.
Dow Theory is known.
I’ve read books and watched videos.
Yet when you open the chart, you get confused.
Which points are the highs, which are the lows.
Is it currently in an uptrend or not.
If this kind of situation continues,
I must tell you some hard truths.
Knowing Dow Theory and being able to use it are completely different.
It isn’t that the knowledge is lacking.
It’s just that you don’t have the procedures to apply it on the chart.
■ Check if it applies to you
□ You can explain Dow Theory, but you can’t quickly identify highs and lows on the chart
□ You’re always unsure which highs and lows to use as the standard
□ You can say “it’s an uptrend,” but you can’t explain the basis
□ You enter trades without realizing the directions differ between higher and lower timeframes
If two or more apply, what’s written in this article is the source of your confusion.
■ There is only one Dow Theory to use in trading
Dow Theory encompasses several ideas.
But for trading, you use only one.
Whether highs and lows are rising or falling.
If highs and lows keep rising, it’s an uptrend.
If highs and lows keep falling, it’s a downtrend.
Updating a high once does not make a trend.
What matters is that the rising or falling continues.
■ You’re hesitant because the method for selecting highs and lows isn’t set
The idea is simple.
Even so, you hesitate on the chart because you haven’t decided where to view as highs and lows.
Prices do not move in straight lines.
They go up a little, then down a little, repeatedly.
If you treat all those small up and downs as “highs” and “lows,”
the trend will change every time you look at it.
It seems to go up, then down, and your judgments wobble.
Dow Theory that does not define the highs and lows you look at cannot be used.
This may sound a bit harsh, but
Searching for highs and lows without a standard is
like trying to measure length with a ruler that has no markings.
■ What you can learn from the video
・ Which highs and lows to use as a reference on actual charts
・ How to judge the trend without being misled by small up-and-downs
・Where to determine whether the trend is continuing or finished
・How to think when higher and lower timeframes point in different directions
■ Who this video suits
・You know Dow Theory but can’t apply it on charts
・You’re always unsure where to take highs and lows
・You want to be able to explain the basis of the trend in your own words
From here on, I will explain carefully using actual charts in a video.
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