Z Cherry Blog

Why You can Use Dow Theory when making forex trades

April 15th, 2008

Most beginning traders get so caught up with the short term or day trading that they completely don’t realize that the real profits lies in making trades long term, not short term. And although initially it doesn’t seem that this will justify a trade because profit is not immediately realized and therefore not "sexy", for the beginner, long term trades are easier to identify than the shorter, more volatile ones.Dow Theory is on of the many theories that you can employ when looking at trades.  One of the parts of the dow theory implies that the trend is your friend and therefore you should follow the trend until it specifies otherwise.  The good news is if you are planning on trading long term, the long tend trades tend to last for months, not hours, minutes or days.  Just something to chew on if you are a new trader and thinking about making trades though.

Entry Filed under: Business