The Dow Theory – Expectation for Continuance of Directional Movement

In order for us to define whether a trend is changing its direction, we need to have a specific indication on the chart, whether for our indicators from our chart itself on the lines, on the candles, whether we’ve got a particular strategy from other directions that confirm this potential:

We’ve got two formations that confirm if a trend is changing:

Once the market breaks a specific support line from the last trend direction, we can see that it’s breaking that with great strength. These are the first stage of professional traders that see a potential for a change of direction according to their inner information. Then we see a pullback, and the market continues moving […]:

We’ve got the uptrend, the first downtrend movement, which is the support line we’ve placed. We’ve got another peek breaking the highest peak that we’ve got from the first support line. And the market is breaking, trying to reconquer this […] movement by failing. And then the market breaks down:

The Dow Theory has main […] rules:

We’ve talked about the […] movement containing all the existing economic information:

The market movement consists of […] trend levels. We’ve divided the trend levels and talked about how to separate that from the chart: