Dow Theory and the golden years Money Tips

Category: Money tips Release Date: 2006-11-02

While the movie "Curse of the Golden Flower" propaganda campaign in full swing when the Chinese stock market in the near future, the "golden years" has become a high appearance rate on the term, "gold" into the word through the end of 2006 China the entertainment industry and capital markets, double star, perhaps just a coincidence, but faded entertainment rendering of "Golden Flower" noisy, from the Dow Theory perspective in a profound process of change in China's capital market over the next decade, it is indeed a pieces quite beneficial thing.

When you see the capital markets, a "decade" of words, people think of first is the "Wall Street Journal," the founder of Charles H · Road, "a decade-cycle theory," That is his in 1902 July 9 Japan's "The Wall Street Journal," commentator's article, according to records of the British economist Jevons commercial crisis in time to conclude: Every decade there is a basic cycle of the bull movement and a basic bear market movement. But since then the U.S. stock market of varying lengths CBBC cycle proved that the "ten-cycle theory" fallacy, because the reality is not, as the same decade, the pendulum, "5-year cow, 5-year Bear" the law of existence.

Although Charles H · Road in the last months of his life's "ten-cycle theory" was smashed by the realities of the vagaries of the stock market, and he was in the "Wall Street Journal" a series on the theory of price movement on the stock market enough success that he "father of technical analysis" in history. Accordance with the "Dow Theory" theorem, one of understanding, the price of the stock market trend is that there are three basic elements: last for a few days to several weeks, the randomness of short-term trends have significant medium-term trend is that for several weeks to several months, the trend, while the long-term trend is going on for several months to several years of market trends, because these three trends exist that may arise with each other in the opposite direction, so only when investors a clear understanding of the former two in the long term trends in the position until it easier to make a profit.

Dow Theory from the perspective of China's current stock market, long-term upward trend has actually been very clear, as regards its long-term trend in the end it just a decade and surely no one would dare such a precise conclusion, after all, study the stock market cycle is still to be resolved a long-standing riddle. However, in the U.S. stock market history, and indeed on several occasions about a ten-year bull market, such as the 1954 round of ten years of that bull market, that is, the securities brokerage sector expertise standardized management, the value of investment analysis theory of the beginning of the rise of the background , looking back now that the Chinese stock market brokerage ongoing governance, to develop institutional investors, value investing is becoming the mainstream, and so on, really, with the Wall Street bull market in 1954, began with a decade there are a lot of the shape of the Department.

It should be noted coincidence, also in 1954, now that he has "shares God," said Buffett, Graham's Graham Muniu Man into the company, formally began his professional investment career. Of the times created a hero, or heroes influence of the times? This is hard to say. But for is gradually entering a new stage of development of the Chinese stock market, the ability to bring out in the next few years, the same as the value of Buffett's investment in the myth, but added a matter of concern and look forward to things.