Dow Theory Signals

The alternative signal method mirrors classical Dow Theory by treating the last completed secondary reaction as an important reference level. Dow Theory buy and sell signals identify primary market trends rather than isolated trade entries. The underlying Dow Theory meaning of a signal is an appraisal of whether the primary trend is bullish or bearish. Dow Theory for the 21st century can use the lows and highs of the last completed secondary reaction as an alternative method for deriving buy and sell signals. A Dow Theory sell signal indicates a primary bear market and an environment considered appropriate for selling. A Dow Theory buy signal indicates a primary bull market and an environment considered appropriate for buying. The alternative method is the second way to derive buy and sell signals in Dow Theory for the 21st century.