* Dow Theory suggests indices must confirm each other and volume must confirm the trend.
* The new downward trend in the Dow Utilities Index suggests indices are starting to break apart in terms of trending in unison.
* Volume recently has been trailing lower, which suggests the momentum behind these new all-time highs is weakening.
* If the Utilities Index continues to move lower and we see increased volume in the selling trend, we will consider the Dow Theory
* Trend component “broken” and expect a major peak/top soon after.
We know some of you are Dow Theory enthusiasts and followers. We follow the Transportation Index as a leading indicator for potential major market trends almost exclusively because of what we have learned from Dow Theory. If you are unfamiliar with Dow Theory, we suggest visiting Investopedia’s summary of this technical theory for a quick refresher. You can also learn more about the primary indicator in Dow Theory here. The two most important aspects of Dow Theory that we are researching today are two components:
Indices Must Confirm Each Other Volume Must Confirm The Trend My researchers and I have identified that the Dow Jones Utility Index has started to break downward in trend, breaking the recent upside price trend. This breakdown in the Utilities Index suggests the Indices are starting to break apart in terms of trending in unison. We have not seen increased volume in the downward trending of the Utility Index yet and we are waiting for this technical trigger to confirm the Breakdown in Dow Theory Trending by watching for the Utility Index to potentially begin a broader downside price move with increased volume. ...Continue Reading Here.
We know some of you are Dow Theory enthusiasts and followers. We follow the Transportation Index as a leading indicator for potential major market trends almost exclusively because of what we have learned from Dow Theory. If you are unfamiliar with Dow Theory, we suggest visiting Investopedia’s summary of this technical theory for a quick refresher. You can also learn more about the primary indicator in Dow Theory here. The two most important aspects of Dow Theory that we are researching today are two components:
Indices Must Confirm Each Other Volume Must Confirm The Trend My researchers and I have identified that the Dow Jones Utility Index has started to break downward in trend, breaking the recent upside price trend. This breakdown in the Utilities Index suggests the Indices are starting to break apart in terms of trending in unison. We have not seen increased volume in the downward trending of the Utility Index yet and we are waiting for this technical trigger to confirm the Breakdown in Dow Theory Trending by watching for the Utility Index to potentially begin a broader downside price move with increased volume. ...Continue Reading Here.
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