XJO Weekly Dow Theory applied 24/11/2016.

According to Rhea, whose work is recognised as the foundation of the Dow Theory by many: “Dow Theory define the trend in terms of peaks and troughs made by swings in the average. Therefore a Bull Trend is a succession of higher peaks and troughs, while a bear trend is a succession of lower troughs and peaks”.

What do we see with XJO weekly ( ASX 200) chart as of this writing ? A higher peak made after a lower trough. Like an outside bar.

This is where the Dow Theory may be disputed by some it’s followers. Some followers of the theory, accepts this phenomenon as a valid trend change, whereas Rhea did not. TA doesn’t meant to be easy I guess with lots of subjectivity.

Let’s focus on the price action of the current week. A confirmed HIGHER PEAK is a good evidence for me to say that the medium term Dow Theory trend is now turned UP with XJO. A bullish development which can not be ignored.

In terms of where the price action is on the other hand, it is testing a prior price resistance level of 5500.What it does from here on is up to the Mr Market off course. But looking at the today’s bar on the daily chart ( not shown) indecision is evident, meaning buyers are not keen nor committed even though they still maintain control.

Weekly XJO chart as at 24/11/2016.



All the information and analysis provided on this website is general in nature and for educational purposes only and does not constitute financial advice. No content in any way implies a recommendation to buy, sell, hold or short sell any financial instrument, nor is it financial advice.

Investing and trading in financial markets carries considerable risk, and should always be done in consultation with a licensed financial adviser taking your personal circumstances, financial situation, objectives and needs into consideration.

Links to other websites are inserted for convenience only and do not constitute endorsement of any of the material on those sites, or any associated organisation, product or service. Kazim Agaoglu is not responsible for the content of any site owned by a third party that may be linked to this website and such links are provided as a courtesy with no judgment or warranty being made concerning the suitability, accuracy or otherwise of the content on any such site.

Kazim Agaoglu disclaims any undertakings, warranties or guarantees, express or implied and shall not be liable for any loss or damage whatsoever arising out of in connection with the use of or reliance upon any of the information on this website. The user accepts sole responsibility associated with the use of the material on this site, irrespective of the purpose for which such use or results are applied. The information on this website is no substitute for financial advice.



Comments are closed.