Category: Investment musings

Dow Theory Special Issue: The two variables accounting for the Dow Theory out and underperformance versus buy and hold

posted on: January 17, 2019

It was a long time of not posting “philosophical” and introspective aspects concerning the Dow Theory. While it may seem evident to many, this post is the result of some nights of serious introspection. I wanted to completely isolate the factors (variables) that account for the Dow Theory outperformanceversus buy and hold (BAH). This is […]

Dow Theory Special Issue: Isolating the value of the principle of confirmation and trend following

posted on: August 25, 2017

How much valuable is confirmation percentagewise? And trend following? It’s been many months without writing a post with some original thoughts which may be useful to the followers of this blog. For the last few months I have been confined to merely analyzing the markets (which in itself is OK and takes time) without any […]

Dow Theory Update for December 6: More on the primary bull market signal

posted on: December 6, 2016

Trends unchanged for gold, silver and their miners: that is bearish On November 21st, 2016 a primary bull market was signaled, as was reported here Let’s further delve into the signal. First of all, let’s take a look at the charts The highs of the last primary bull market (red horizontal lines) were bettered […]

Dow Theory Update for November 24th: More about the primary bull market signal for US Stocks

posted on: November 24, 2016

How Jack and Bart Schannep avoided the primary bear market trap In my last post I briefly mentioned that the primary trend had turned bullish as per Schannep’s Dow Theory. As explained, the primary trend was already bullish according to the “Rhea/Classical” Dow Theory, as was explained and summarized here Before continuing, I’d like to […]

Dow Theory Update for November 7: The current trend as per the classical/Rhea Dow Theory (II)

posted on: November 7, 2016

Appraisal as per a strict application of the “Rhea/Classical Dow Theory” We know that the trend determined by Schannep’s Dow Theory is bearish (signal of November 2, as explained here). We also know that the trend according to the “Rhea/Classical” Dow Theory as interpreted by Schannep is bullish (signal of 9/7/2016), as was explained here. […]

Dow Theory Update for November 4: The current trend as per the classical/Rhea Dow Theory (I)

posted on: November 4, 2016

Schannep’s interpretation In my last post I wrote that there are diverging opinions when it comes to determining the primary trend according to the “Rhea/Classical” Dow Theory. The starting point where, it seems, there is unanimity is a primary bear market which was signaled on 6/24/2016. Disagreement begins when it comes to gauging the existence […]

Dow Theory Special Issue: Putting the Dow Theory under Stress-Test (VIII)

posted on: October 17, 2016

Dow Theory’s performance under weak cyclical bull markets This “stress-test” saga has dealt with performance under secular bear markets Another environment which is detrimental to the Dow Theory is weak cyclical bull markets. What is a cyclical bull and bear market? I see cyclical bull/bear markets as a long movement which is an order of […]

Dow Theory Special Issue: Putting the Dow Theory under Stress-Test (VII)

posted on: September 9, 2016

When most ruled-based trading ceases to work, the Dow Theory continues to perform In this post of my stress-test saga, I made clear that we are currently living a real “stress-test”. Current market conditions are not the best for the Dow Theory. Narrow ranges of less than 15% are detrimental (but not lethal) to the […]

Dow Theory Special Issue: Putting the Dow Theory under Stress-Test (VI)

posted on: September 2, 2016

Fractality at work. Narrow ranges tend to contain narrow secondary reactions This post is to be understood as an “addenda” to my yesterday’s post. I feel the following thoughts further strengthen my belief concerning the sturdiness of the Schannep’s Dow Theory under narrow range conditions. Thus, the losses resulting from a prolonged ranging environment could […]

Dow Theory Special Issue: Putting the Dow Theory under Stress-Test (V)

posted on: September 1, 2016

What happens to the Dow Theory when the market enters into “fibrillation” (Narrow ranges)? Looking into the future The following conclusions may be derived from my first post concerning the Dow Theory and narrow ranges: 1) Historically, the maximum drawdown caused by cumulative losing trades amounted to less than 19%. 2) This drawdown was not […]

Dow Theory Special Issue: Putting the Dow Theory under Stress-Test (IV)

posted on: August 29, 2016

What happens to the Dow Theory when the market enters into “fibrillation” (Narrow ranges)? We continue our saga of looking at the Dow Theory from all possible angles (specially the stressful ones). Narrow ranges are the plague to trend followers. While the Dow Theory by integrating the time and extent element is less prone than […]

Dow Theory Update for August 10: Two interesting articles which may help investors

posted on: August 10, 2016

Trends unchanged The Industrials remain below their secondary reaction closing highs, and hence no primary bull market signal has been signaled. More about this here The first article clearly shows that making money in the market is not so easy. Even for buy and hold, and assuming the very lenient US stock market for investors […]