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Data:2009-12-12 2:34
Theorem 1 - Tao's three movements (short-, medium-and long-term trends)
Theorem 2 - the main trends (bear or bull market)
Theorem 3 - the major bear market (including the three main stage)
Theorem 4 - a major bull market (there are three main stage)
Theorem 5 - Secondary Reactions (also called "amendment to the trend," down trend bull market or bear market, rising trend).
19th century, 20 years editor of Forbes Magazine, Richard. Xia Bake, inherited and developed the Dow's point of view, and study how the "average stock price index" appears in the important technical signal applied to each individual stock. Published in 1948 by Robert D ยท Edwards Yuehanmaiji by the "" Technical Analysis of Stock Trends "" a book, inherited and carried forward Charles Road and Richard Xia Bake ideas, has now been considered to be the trend and pattern recognition analysis of the authority of the making.
"" Technical Analysis of Stock Trends "" The book summarizes the Dow theory, the basic points:
A wave, wave and ripple
Two stages of the underlying trends
Third, the principle of mutual authentication
Also on the "Dow Theory's Defects" were discussed.
The theoretical basis for Dow
Dow Theory is of great importance to the three assumptions, and people rarely see the theory of technical analysis is somewhat similar to the three assumptions, however, where the Dow Theory is more focused on understanding the meaning of its market.
Suppose a: man-made operations (Manipulation) - index or securities every day, every week, volatility may be subject to man-made operations, sub-return movements (Secondary reactions) may also be limited impact to this area, such as adjustment of the common trend, but the main Trends (Primary trend) will not be man-made operation.
Some people might say, the dealer can operate the main trends in the securities. In the short run, if he did not operate this be suitable for the inner quality of the securities will be subject to other people's operations; the long term, changes in corporate fundamentals continue to create suitable conditions for operation of the securities. Overall, the company's main trend is still unable to man-made operations, but the securities for a variety of institutional investors and the different operating conditions only. Assumption 2: the market index will reflect each piece of information - each one an understanding of financial matters for the market participants, all his hope, despair and knowledge will be reflected in the "Shanghai Composite Index" and "Shenzhen index" or other What is the daily closing price index fluctuations; so, the market index will always be appropriate to expect that the impact of future events. In the event fires, earthquakes, wars and other disasters, the market index will quickly be assessed.
In the market, it is a day for the financial and economic policies, such as, expansion, the leaders of the speech, institutional violations, and other layers of the GEM endless subject matter are constantly being assessed and judged, and continue to be reflected in their psychological factors to the market decision-making. Thus, for most people, the market has always seemed difficult to grasp and understand.
Suppose 3: Dow Theory is an objective-oriented analysis theory - use it to help the success of speculation or investment behavior, require in-depth study and objective judgments. When the subjective use it, they will kept making mistakes and losses.
