Category: Dow Theory

Bonds in Crisis: Discovering Dow Theory’s Healing Touch

posted on: October 12, 2023

Dow Theory’s Prescription for the Bond Debacle Dilemma Due to the surge in interest rates, long-duration bonds have experienced a significant loss of value, amounting to a 50% drawdown. This substantial decline in the so-called safe haven asset class resembles the drawdowns seen in stock indexes, underscoring the fact that unexpected events occur. Investors sometimes […]

Dow Theory Update: The primary bear market in gold and silver reconfirmed on 9/29/2023

posted on: October 7, 2023

Gold and Silver miners ETFs (GLD & SIL) bearish trend unchanged General Remarks: In this post, I thoroughly explained the rationale behind using two alternative definitions to appraise secondary reactions. GOLD AND SILVER A) Market situation if one appraises secondary reactions not bound by the three weeks dogma. I explained HERE that gold and silver […]

The Principle of Confirmation can save your skin (II). Example 2: IEF breakup turned into a bull trap.

posted on: September 2, 2023

In my previous post, I explained the principle of confirmation in action when applied to U.S. stock indexes. In this post, we will see its application to bonds. The starting point is the primary bear market that was signaled on 9/20/22 (as explained HERE). Following the 10/24/22 bear market lows, a rally followed that qualified […]

Dow Theory Update for August 31: Gold and Silver may trigger a new primary bull market soon

posted on: August 31, 2023

The setup for a primary bull market was completed on 8/2/23 General Remarks: In this post, I thoroughly explained the rationale behind my use of two alternative definitions to appraise secondary reactions. GOLD AND SILVER A) Market situation if one appraises secondary reactions not bound by the three weeks dogma. I explained HERE that gold […]

The Principle of Confirmation can save your skin. Example 1. Dow Transportation breakdown

posted on: August 25, 2023

One fundamental tenet of the Dow Theory holds that the movement of one index, when not confirmed by another, should be disregarded. This principle underscores that a Buy or Sell signal originating from one index, such as surpassing a prior high or breaking down below a previous low, carries no significance if it lacks validation […]

Dow Theory Update for July 22th: Secondary reaction for gold and silver signaled on 7/18/23

posted on: July 22, 2023

Executive summary: The gold and silver (GLD & SLV) have been under a secondary reaction since 7/18/23. The current secondary reaction notwithstanding, the primary trend for gold and silver remains bearish. General Remarks: In this post, I thoroughly explained the rationale behind my use of two alternative definitions to appraise secondary reactions. GOLD AND SILVER […]

Dow Theory Update for July 20: Heretical Interpetations of the Dow Theory (II)

posted on: July 21, 2023

Not everything promoted as “Dow Theory” is the correct Dow Theory In four past posts (here, here, here, and here I debunked what I believe are incorrect and underperforming interpretations of the Dow Theory. The Dow Industrials’ newer highs have sparked claims from various “Dow Theory experts” that a new Bull market has emerged, which […]

Dow Theory Update for June 3: Setup for a primary bear market signal for GLD and SLV completed on 6/1/23

posted on: June 9, 2023

I am writing before the close of 6/3/23. So readers, beware, things may change. Executive Summary: 1. The primary trend for gold and silver is bullish, the secondary one is bearish, and the setup for a potential primary bear market signal was completed on 6/1/23. The primary trend for gold and silver ETF miners (GDX […]

Dow Theory Update for December 1st: Primary bull market for gold and silver signaled on December 1st.

posted on: December 1, 2022

GDX and SIL in a primary bull market too A new primary bull market has been signaled in precious metals today (12/1/22). Yesterday, silver broke topside its secondary reaction highs. Today, gold confirmed, providing the awaited primary bull market signal. I hope to write soon a comprehensive article explaining the intricacies of this new […]

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 […]