The Dow Theory is the oldest method of identifying major trend reversals in the U.S stock market. The main objective of the theory is to determine changes in the primary movement of the market. Charles H.Dow was the developer of the Dow Theory in 1900. The Dow Theory was used as a barometer for business conditions rather than a tool for forecasting stock market prices back then. The principles were further developed and reorganized by William Peter Hamilton in 1922 which was later formalized by Robert Rhea in 1932 and E. George Schaefer into a more complete account of principles that is practical for use today. Read the rest of this entry »