DOW THEORY - What is it & how can it be applied to the stock market?

What is Dow Theory?
The theory was developed by Charles Dow prior to the 1900's and although some parts of it are outdated many of the theory principles remain the same.
The Dow Theory has evolved overtime and many stock traders will now relate to the theory as technical analysis or trend following.
This video provides a quick summary.
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0:00 Introduction
1:29 Three kinds of Market Trends
2:01 Primary Trends have Three Phases
2:44 #4. Indices Must Confirm Each Other
3:34 Volume Must confirm the Trend
4:20 Trends Persist Until a Clear Reversal Occurs
4:48 Interpreting and Implementing Dow Theory
5:58 Limitations of Dow Theory

Пікірлер: 67

  • @FinancialWisdom
    @FinancialWisdom2 жыл бұрын

    My Brokerage Account (Interactive Brokers) - bit.ly/3UGvn1U My Breakout Scanner - bit.ly/3ea6sl8 My Forum - www.financialwisdomTV.com/forum My Strategy Blueprint - www.financialwisdomtv.com/plans-pricing Edgewonk Trade Analysis Software - bit.ly/3xS6S7s

  • @peterodaka7651
    @peterodaka76512 жыл бұрын

    Investment is your only way up to financial freedom.

  • @peterodaka7651

    @peterodaka7651

    2 жыл бұрын

    His Te-le-gr am ( @Jefferno7

  • @joyjoyful4843

    @joyjoyful4843

    2 жыл бұрын

    Outstanding is the word! His knowledge and expertise as a trader is really extraordinary.

  • @anton5259

    @anton5259

    2 жыл бұрын

    I am winning what I believed was inconceivable, rather than questioning, get in touch with him and see for your self

  • @Jack-kw1qe

    @Jack-kw1qe

    2 жыл бұрын

    I have been seeing so many recommendations about Jeff Erno, His strategy must be good for people to talk about him. Does he work for companies as well, I might be able to get him a deal with my board here in Canada

  • @antonypeter6892

    @antonypeter6892

    2 жыл бұрын

    Good content.. but despite the price dip of Bitcoin, i still look forward on acquiring more and some BTC because i see the btc coming soon.

  • @joebhlee
    @joebhlee Жыл бұрын

    You are the most clear teacher on KZread on investing and trading.

  • @FinancialWisdom

    @FinancialWisdom

    Жыл бұрын

    Thanks 👍

  • @williamkz
    @williamkz2 жыл бұрын

    Thanks Gareth. Useful recap.

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Glad it was helpful!

  • @BioInsight_Lectures
    @BioInsight_Lectures2 жыл бұрын

    As the always "great video". Thanks

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Thank you too!

  • @samcurran8124
    @samcurran81242 жыл бұрын

    Most rational investor.

  • @eagerjhoe2314
    @eagerjhoe23142 жыл бұрын

    Thanks great content ☺️

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Glad you liked it!

  • @alirezasharifan7841
    @alirezasharifan78412 жыл бұрын

    Thanks , it was good. your last works were great

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Glad you like them!

  • @Amitkumar-gh7wc
    @Amitkumar-gh7wc2 жыл бұрын

    reading books is now easier with your nice explanation, thanks for the great content.

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Glad you like them!

  • @donniereidjr
    @donniereidjr2 жыл бұрын

    Phenomenal video!

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Thanks

  • @adjeimensahgeorge9035
    @adjeimensahgeorge9035 Жыл бұрын

    please make a video on Jason Alan Jankosky's Exploiting Multiple Time Frames in Zero-Sum Markets

  • @conor_cork
    @conor_cork2 жыл бұрын

    “The downtrend reverses when the price breaches the previous high and makes a lower low”? Should it not be “makes higher low”?

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Doh! yes it should, apologies.....

  • @mukhriztrading8071
    @mukhriztrading8071 Жыл бұрын

    DJT is still relevant today. You should learn more about the global economy in general and learn more about the Dow Theory.

  • @fidelisokodu201
    @fidelisokodu2012 жыл бұрын

    Nice videos.

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Thanks

  • @MightyReturns
    @MightyReturns2 жыл бұрын

    Feedback/Request: You should make a video on returns when short-selling in bear markets. Lots of good videos on your channel on "profiting in bull markets and going to cash in bear markets" but a video on "rather than going to cash, what would the returns be like if we shorted Nasdaq, ARKK, etc" would be great. Thank you for all your hard work. William O'Neil says, “Buying without the ability to sell is like a football team that is all offense and no defense. To win, you must understand and execute both.”

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Noted. thanks

  • @sqs309

    @sqs309

    2 жыл бұрын

    Nice. I would love to watch too some bear markets returns

  • @suthan2003

    @suthan2003

    2 жыл бұрын

    Quite possible....but I think the idea behind sitting on cash is to find the next best buy opportunity where both fundamental and technical aligns ....further if you look at shorting, maximum gain is double but potential loss is unlimited (remember stop loss is not always guaranteed to execute).....but in Long max loss is the Money you put in but maximum profit is theoretically unlimited.....just a thought....

  • @mondymysan7905

    @mondymysan7905

    2 жыл бұрын

    Agree.

  • @MightyReturns

    @MightyReturns

    2 жыл бұрын

    ​@@suthan2003 yeah I get all that BUT while it is true that your upside is limited with shorting, a stock can be cut in half to infinity. As William O'Neil says, “Buying without the ability to sell is like a football team that is all offense and no defense. To win, you must understand and execute both.” Stan Weinstein is another who "profits in both bull and bear markets". This channel has videos on them but we haven't explored/backtested shorting much and at the very least, we should explore it further on this channel at least once given we have a lot of great content on "long/buy-hold" already.

  • @mohamedmostfa9234
    @mohamedmostfa92342 жыл бұрын

    my best stocks chanel

  • @samcurran8124

    @samcurran8124

    2 жыл бұрын

    Mine too

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Thanks 🙏

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Thanks 🙏

  • @vg-99
    @vg-99 Жыл бұрын

    Thanks

  • @FinancialWisdom

    @FinancialWisdom

    Жыл бұрын

    Welcome

  • @AdamHarrisTrader
    @AdamHarrisTrader2 жыл бұрын

    At 5:34 you misspeak- you say 'lower-low', when I think you mean 'higher-low'?

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    I did, sorry....

  • @TylersRapPromo
    @TylersRapPromoАй бұрын

    If you made it this far to stumble on this type of theory your already there

  • @gkrishna1620
    @gkrishna16202 жыл бұрын

    If you could, please make strategy and learning video on SECRETS OF PIVOT BOSS. THANKS FOR ALL THE EFFORTS. THIS MEANS A LOT FOR US.....!

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Noted

  • @NHisways
    @NHisways Жыл бұрын

    I wish I could ask Mr. Dow what the purpose of using Dow theory is if you cannot beat the market?

  • @FinancialWisdom

    @FinancialWisdom

    Жыл бұрын

    You can beat the market 😉

  • @DarkBullCapital
    @DarkBullCapital4 ай бұрын

    who is 3rd / 4th person in the black and white picture?

  • @fidelisokodu201
    @fidelisokodu2012 жыл бұрын

    I've not been able to find a stock broker that would allow me from Nigeria to be able to trade the US, Europe, and other international stocks.

  • @alirezasharifan7841
    @alirezasharifan78412 жыл бұрын

    I think you forgot to make the 2nd part of O Neil CANSLIM😉

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Did I :-)

  • @you-bq3ob
    @you-bq3ob2 жыл бұрын

    Your content is great and ive watched ur every video but trust me mate on this one...just remove that owl from your thumbnails, it will open up some space then use bright colours (not too fancy) and you will grow faster.....just try it once

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Thanks for the tip

  • @you-bq3ob

    @you-bq3ob

    2 жыл бұрын

    @@FinancialWisdom the other reply is also urs??

  • @you-bq3ob

    @you-bq3ob

    2 жыл бұрын

    ​@@FinancialWisdom plz add some sort of low music in background and speak casually, not like a robot and from ur channel's dp rmove the thumbs up guy and also create something new for thumbnails and ur dp

  • @cagrikanik2403
    @cagrikanik24032 жыл бұрын

    Hi FW thanks for the video but when somebody says something is outdated then suddenly i remember Jesse Livermore’s quote. “There is nothing new in Wall Street. There can’t be because speculation is as old as the hills. Whatever happens in the stock market today has happened before and will happen again.” :-) so it could be still enough to make money :-)

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    So true :-) - The psychology has certainly not changed.

  • @mmm-cake
    @mmm-cake18 күн бұрын

  • @mr.ganesh4001
    @mr.ganesh40012 жыл бұрын

    Share note on dear WD Gann💥

  • @FinancialWisdom

    @FinancialWisdom

    2 жыл бұрын

    Sure 👍

  • @jayluce1650
    @jayluce16502 жыл бұрын

    Richard Russell... "Dow Theory Letters"

  • @wonhur885
    @wonhur8852 жыл бұрын

    My friend in Texas referred me to this channel you make a lot of sense but I do not understand anything until she referred me to a financial counsellor in USA that help me to craft my portfolio and over a year we have been working together making consistent profit enough to get me a new apartment and care for parents.

  • @wonhur885

    @wonhur885

    2 жыл бұрын

    @Abigail Prewitt it is not a he. It is a lady. I see most things she says and use to carry out trades are done by Steve. that is how I know she knows what she is doing. in her technique of over night trading she says she use stop loss and take profit strategy. She trade on her account and it reflects on your own

  • @wonhur885

    @wonhur885

    2 жыл бұрын

    @Abigail Prewitt Her name is ASHLEY AIRAGAHI. Look her up online, she is quite popular in America and a certified financial adviser.

  • @wonhur885

    @wonhur885

    2 жыл бұрын

    @Abigail Prewitt I have referred a few of my friends, she is working with them currently and they have improved greatly with their finances. I have made 153,000 usd since Nov with a capital of 10,000 usd that i initially deposited, she collects her fees after you have made profit and her style is such that I am in control of my funds and to a large extent also what happens on my account

  • @lexlevi1
    @lexlevi15 ай бұрын

    He couldn’t complete it because the market is forever changing and the Dow is irrelevant now

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