Category: Daily update

Dow Theory Update for November 8: The typical profit/loss profile in trend following

posted on: November 8, 2022

And don’t forget the Dow Theory is trend following! Trend following works, BUT you must be willing to accept that most trades will be small winners, and some will be losers. Eventually, if one is patient, one strong trend will emerge, and profits on that trade will make for all small losses and then some. […]

Dow Theory Update for October 28: The four requirements of a good trend following system

posted on: October 28, 2022

Good (and less good) trend following This is an important post as it will dispel some trend-following myths. I plan to expand this post in the future or write additional posts on this subject. What makes an excellent trend-following system? A good trend-following system must meet four requirements: […]

Dow Theory Update for October 20: Comparing the 1987 and 2020 stock market crashes.

posted on: October 19, 2022

As promised yesterday, I am reproducing and updating one post I penned two years ago comparing the 1987 and 2020 stock market crashes. Yesterday, October 19th was the 35th anniversary of the 1987 stock market crash. I wrote about it in the past and made clear that the Dow Theory (of any flavor whatsoever) […]

Dow Theory Update for October 19: Revisiting the Oct. 19th 1987 crash (35 years)

posted on: October 19, 2022

Did the Dow Theory help? YES Today, October 19th, is the 35thanniversary of the 1987 stock market crash. So, it is timely to revisit two posts a penned in the past. Today, I reproduce and update one post I wrote exactly 10 years ago. Tomorrow, I will repost the second one. How fared those […]

Dow Theory Update for October 13: Even “normal” trend following works if you are patient.

posted on: October 13, 2022

Trend following works BUT most people cannot digest the spells of underperformance and/or drawdowns that inevitably occur. You must be patient and control your fears. The chart below is taken from the October monthly report of a very successful trend-following fund with a track record starting in April 99. The red lines show all […]

Dow Theory Update for October 12: Heretical interpretations of the Dow Theory

posted on: October 12, 2022

Not everything promoted as “Dow Theory” is the correct Dow Theory Three years ago, I wrote a saga of three posts explaining what I consider “divergent” interpretations of the Dow Theory, namely interpretations that do not fully reflect what true Dow Theorists like Robert Rhea did, and are likely to result in underperformance. More […]

Dow Theory Update for September 22: Primary bear market for bonds signaled on 9/20/22

posted on: September 22, 2022

No secondary reaction on the horizon General Remarks: In this post, I provided a thorough explanation concerning the rationale behind my use of two alternative definitions to appraise secondary reactions. TLT is the iShares 20 years + Treasury bond ETF. More about it here IEF is the iShares 7-10 years Treasury bond ETF. More […]

Free virtual Event at the MoneyShow. Join me to learn how to build a Dow Theory-based portfolio with ETFs

posted on: September 20, 2022

Mark the date: Sept. 27, 2022 (12:50 pm to 1:20 pm EDT) Join me Live in Person at the Virtual MoneyShow next September 27, 2022 (12:50 pm to 1:20 pm EDT).I will explain how to use the Dow Theory to trade all kinds of ETFs, to build a diversified portfolio with marked drawdown reduction […]

Dow Theory Update for September 19: Halmiton’s market calls (1900-1929) revisited

posted on: September 19, 2022

Does the classical Dow Theory yield positive risk-adjusted returns? The answer is: YES. The article linked below penned by William Goetzmann proves that the market calls made by Dow Theorist Hamilton from 1902 to 1929 beat buy and hold on a risk-adjusted basis. https://citeseerx.ist.psu.edu/viewdoc/download;jsessionid=9D2DF4DC55D81DA9EEFADA02B019F9F2?doi=10.1.1.199.1866&rep=rep1&type=pdf The edited chart below extracted from the linked […]

Dow Theory Update for September 13: U.S. bonds flirting with a primary bear market signal

posted on: September 13, 2022

But not there yet! General Remarks: In this post, I provided a thorough explanation concerning the rationale behind my use of two alternative definitions to appraise secondary reactions. TLT is the iShares 20 years + Treasury bond ETF. More about it here IEF is the iShares 7-10 years Treasury bond ETF. More about it here. […]

Dow Theory Update for September 5: Primary bear market for SLV and GLD reconfirmed on 9/1/22

posted on: September 5, 2022

GOLD AND SILVER A) Market situation if one appraises secondary reactions not bound by the three weeks dogma. As I explained here, the primary and secondary trend was signaled as bearish on 6/30/22. Following the 7/20/22 closing lows for GLD and 7/25/2022 for SLV, a secondary (bullish) reaction against the primary bear market developed. After […]

Dow Theory Update for September 3: Primary bear market for SIL and GDX reconfirmed on 8/30/22

posted on: September 3, 2022

Primary bear market for GLD and SLV reconfirmed on 9/1/22. Very soon, I will pen a new post concerning GLD and SLV. The overall picture for precious metals is bearish. I don’t want to give names, but when I signaled a primary bear market, I was criticized. The perma-bulls had an arsenal of reasons for […]