About DOW Technical Analysis
Volume-based technical analysis of the all the Dow Jones index components is a very powerful tool and is a prerequisite for anyone who wants to predict financial market movements and build a successful DOW trading system.
A technical analyst doesn't generally look too much at income statements, balance sheets, company policies, or many other fundamentals about the company. And a REAL technical analyst doesn't rely only on price analysis, but relies heavily on volume analysis as it is volume which drives price movements. This type of analysis usually done in the form of a chart. The security can be a stock, future, index, or a sector. It is flexible enough to work on anything that is traded in the financial markets.
This trading system is not 100 percent mechanical as it does have a level of subjectivity. The basic technology behind this trading system is MarketVolume and its system of volume technical analysis. MarketVolume's JavaVolume charting technology allows our analysts to make informed, but still somewhat subjective, decisions as to where the market is going in the mid and long-term, and to make a trade based on the results of that analysis. Also keep in mind that this system has incorporated other forms of technical analysis.
Every Dow Jones trader and DOW technical analyst knows the importance of index charts and index indicators, but that is not the whole picture. What sets our analysts and traders apart from the 'traditional' technical analyst is the fact that they do not solely concentrate on price movement alone. A good term for the type of technical analysis behind our Dow Jones Trading System is Fundamental Volume Analysis, in which we analyze the cause of the price movements in DOW, while traditional technical analysis generally only focuses on price.