Dow theory

Discussion in 'Technical Analysis' started by indahook, Nov 7, 2007.

  1. So very close here to a sell signal using Dow Theory.

    A INDU close below 13079 will confirm. TRAN is leading and has cracked already.

    TRAN weekly attached here

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  2. INDU attached here.

    A weekly close only is used for this timing method.

    In the old days before it was cost effective to get short the index via futs they used to just go to cash.

    This is for fun only, as I have been out of equites since Oct 19th.

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  3. nitro


    I disagree. The sell signal is well below here imo.

    In INDU, it is approx 12800, maybe a tad below. In SPX, it is approx 1400. It would have to close below those for it to be chart damage.

    I would be careful selling 12800 INDU anyway without SPX confirming - I can't imagine the DJX leading the SPX down in this weak dollar environment.

  4. OK, thats what makes a mkt...

    A straight sell in the $SPX is at a close<1432.67 for me.

    But as far as my the Dow theory signal is concerned I aint budging! :D If the INDU follows and cracks the previous intermediate higher low as the TRAN continues south then its all over but the crying.
  5. <i>So very close here to a sell signal using Dow Theory. </i>

    I disagree as well. Not even a lower high yet, or even a break of a uptrendline. In a hurry?

  6. You can disagree, this is America the beautiful!

    But if you think the INDU weekly hasn't made a lower high yet you may want to look again. Nowhere in the Dow theory does it say what the magnitude of a retracement must be to be considered valid.

    A Dow theory sell signal certainly has not been triggered I said we are close. And I am watching.

    Good trading to you!
  7. Update.

    INDU weekly attached, Price has breached a 16 month old up trendline. Is trading slightly below support and below the 40 week/200 day Simple MA.
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  8. TRAN

    Same way. Price has cracked 3 year up trendline, breached support and trading below the 40 week/200 day simple MA.

    Good trading to you.

    HAPPY BIRTHDAY to my fellow Marines!.

    Semper Fidelis,
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  9. Well the TRAN is/has been telegraphing loud and clear for anybody that cares to listen a serious message. High fuel prices affect the bottom line. Sector be damned companies that produce anything must deliver that product.

    Regarding investments there is beauty in simplicity.

    From the WSJ -

    FedEx Cuts Earnings Outlook

    Since then, "our fuel costs have increased more than 8%, or $85 million," Chief Financial Officer Alan B. Graf said Friday. "While we have dynamic fuel surcharges in place, they cannot keep pace in the short-term with rapidly rising fuel prices. In addition, less-than-truckload freight trends in the FedEx Freight segment remain weak, despite economic signs that the decline in U.S. industrial production has hit bottom."

    I will post up new end of week charts of the TRAN and INDU tomorrow.

    Good trading to you!
  10. The Dow Theory worked like this 100 years ago. Today, in the era of modern computerized analysis, the Dow Theory still works, only it is wearing different clothes (erm, studies that is).
    #10     Nov 17, 2007