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The rules for Dow Theory are well defined and extremely simple. Your claim that it has many interpretations are wrong. Where is your analysis of Dow Theory signals that indicates that it doesn't work?
There are people who go outside the Elliott Wave Theory and create their own interpretations using the base model to suit their own use or their own agenda, which is what I stated. I make no claims about whether the original theory is effective. It attempts to model investor psychology through a series of movements and counter-movements, which are collections of trending price points referred to as waves.
People view stock charts and aggregate data points into moving average lines, waves, cycles, etc. to filter out random movements. That is generally how information is analyzed to reduce the clutter. Just chattering about price figures without any reference point is less than useless. That is generally what most of the participants on stock forums engage in and are only capable of.
S&P right on 2600 line right now. See what it triggers if it goes below.
Elliott Wave, like Dow Theory has many interpretations hence their poor ability to predict. If using past performance to predict future returns were that easy there would be numerous money managers that use it to beat the market every year. If you can provide a list of them I would be open to learning, until then these "theories" are all just a bunch of arbitrary searching for meaning in wavy lines!
I agree about Elliott Waves. I've never found them to be useful.
There have been academic studies, using back testing, that have shown that some forms of technical analysis do generate excess returns. I don't view them as predictive; instead, they communicate a shift in the odds that a price move is more likely one way or the other.
The "random walk" people say price movements can't be forecasted. Probably was true decades ago. Today, with so much trading being done by computers, random walk isn't so random when the big players have all programmed basic tech analysis patterns into their algorithms.
The rules for Dow Theory are well defined and extremely simple. Your claim that it has many interpretations are wrong. Where is your analysis of Dow Theory signals that indicates that it doesn't work?
There are people who go outside the Elliott Wave Theory and create their own interpretations using the base model to suit their own use or their own agenda, which is what I stated. I make no claims about whether the original theory is effective. It attempts to model investor psychology through a series of movements and counter-movements, which are collections of trending price points referred to as waves.
People view stock charts and aggregate data points into moving average lines, waves, cycles, etc. to filter out random movements. That is generally how information is analyzed to reduce the clutter. Just chattering about price figures without any reference point is less than useless. That is generally what most of the participants on stock forums engage in and are only capable of.
Here's my take on Dow Theory--The DJIA and DJTA could both hit all-time highs right before a bear market. Or they could hit new lows while bottoming out then start their march higher in a new bull. Whether or not two indexes have just moved in tandem tells you nothing about the future. If the Dow Theory truly worked, taken its most literal, it would imply outcomes that can’t match reality.
I think the overarching theme of these "theories" "charts" "moving averages" and "trend lines" is that they don't predict where the market will go as their pundits claim. Wish it was that simple!
It was "around 2600 on the buildup to the high in Jan
And has been in same "window" for while --
It can't gain purchase to break out for variety of reasons...
As I said before (and some poster/s took issue with) this is still correction territory
The market has to surpass the high in Jan before it can be said to be out of correction territory...
SP500 dropped below 2600 briefly today--above slightly now...
Location: Was Midvalley Oregon; Now Eastside Seattle area
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Yay, able to buy a stock that had a precipitatous drop this morning. Hope to sell by tomorrow but can hold if necessary.
My sentiment is neutral to slightly down equity for 2018.
JMO and only JMO. I can afford any losses. It's DISCRETIONARY funds.
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