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 Welcome to Dow Theory Letters

A Leader and Innovator in Technical Stock Market Analysis

 for over 50 Years!

 

Richard Russell and his team of talented analysts work daily to bring you the best of primary trend analysis, investor education and intelligent investing advice.

 

How We Are Different

  • We believe in “market timing.” Our goal is to get you out at the top and in at the bottom of major, long-term market moves.
  • Daily edition. Dow Theory Letters is published daily, an hour after the market closes, at 2 pm, Pacific Standard Time. 
  • Value. We provide the analysis of our entire team to you for one low price.

 

What You Get

  • Daily market analysis from one of our outstanding columnists
  • Daily commentary and musings from analyst emeritus Richard Russell
  • The Primary Trend Index (PTI) our proprietary trend indicator
  • Market data section with everything you need to get a full picture of how the market is evolving

 

 


Quote of the Day

"Great thoughts speak only to the thoughtful mind, but great actions speak to all mankind." Emily Bissell

The Waiting Game

By Matthew Kerkhoff

 

The major averages are giving us little to work with in the way of price action. They’re just treading water, sitting comfortably inside trading ranges that have lasted all year.

 

Below we see a daily chart of the S&P 500, with the index staying inside a 75 point range for the last six-months.

 

Conventional technical analysis would view this as a flag or continuation pattern, representing a period of consolidation before a resumption of the prior trend. That’s a nice way of looking at things, but we have no way of knowing what truly lies ahead. The break up, or down, will happen as the average discounts changing future economic conditions, not in response to imperfect classifications of historical price movement.

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Slippage Continues

By Richard Russell

 

Investor's Business Daily headline, 7/31/15: "Fed Rate Hike Probability in September Increases to 50%."

 

From every side, it appears that the Fed is more than anxious to raise the Federal funds rate. This is based on the Fed’s perception that the economy is rosy and growing stronger.

 

However another Investor's Business Daily headline from the same issue states: “Worst Expansion Since WWII Gets Even Worse.”

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More of the Same

By Matthew Kerkhoff

 

A subtle rebound in equity prices this week has put most major averages back inside their trading ranges, giving us little new information to work with in terms of price action. It seems the current holding pattern is slated to continue until we see more decisive developments arise.

 

On the economic front, data continues to whipsaw but for the most part remains positive.

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The New System

By Richard Russell

 

The Dow Jones Averages are now in a state of extreme divergence. While the Dow is in shooting distance of all time highs, the Transports incredibly are at six-month lows.

 

As I write 40 minutes before the close, the Dow is down 40 and Transports are down 11, thus closing the distance between the two. My thinking is that the two averages are moving steadily towards their normal relationship.

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