Dow Theory update for Sept 28: Markets down with no technical consequences

It was Charles Dow, father of the Dow Theory, who said that in the world of investing you have to “exercise enough patience for six men.” He meant by this that the markets don’t accommodate our wishes and even the best laid out investment plan may take time to materialize. The Dow Theorist investing along the primary trend will always find plenty of opportunities to bore themselves. This is not day trading and many boring days deprived of technical significance go by. It is no wonder that success in investment requires, first and foremost, patience. Charles Dow knew his trade well. These boring days should be used to hone your investment skills and to analyze the market or read a blog like this. Don’t be tempted into action.

We are in a situation that requires patience. In this blog we will exert patience.  On the one hand, we would like to see a clear secondary reaction to occur which would be great for latecomers and for us to raise our trailing stop in order to lock in some unrealized gains. If you think I’m nuts for welcoming a secondary reaction, maybe you should read this and this.

Today all markets closed slightly down. The three stock indices we monitor and gold, silver and their miners ETFs.

In the stock market we had a bearish volume day. On a down day volume was higher than yesterday’s which has a bearish connotation. We have had 4 bearish days in the last 6 days; including the monster bear volume of last Friday 09/21/2012.

I will try to finish the saga of “Plain Vanilla Dow Theory or does Dow Theory come in many flavors?” this weekend. I repeat again, the real good follower of the Dow Theory should invest more time instructing himself about the markets than playing them. A weekend reading may be a good opportunity for us all to hone our skills.

Here you have the figures for today of the markets I monitor.

 

Data for September 28, 2012
DOW THEORY PRIMARY TREND MONITOR SPY
			SPY
Bull market started		06/04/2012	128,1
Bull market signaled		06/29/2012	136,1
Last close		09/28/2012	143,97
Current stop level: Bear mkt low			128,1
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
5,78%	12,39%	6,25%
DOW THEORY PRIMARY TREND MONITOR GOLD (GLD)
			GLD
Bull market started		05/16/2012	149,46
Bull market signaled		08/22/2012	160,54
Last close		09/28/2012	171,89
Current stop level: Bear mkt low			149,46
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
7,07%	15,01%	7,41%
DOW THEORY PRIMARY TREND MONITOR SILVER (SLV)
			SLV
Bull market started		06/28/2012	25,63
Bull market signaled		08/22/2012	28,92
Last close		09/28/2012	33,48
Current stop level: Bear mkt low			25,63
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
15,77%	30,63%	12,84%
DOW THEORY PRIMARY TREND MONITOR ETF SIL
			SIL
Bull market started		07/24/2012	17,08
Bull market signaled		09/04/2012	21,83
Last close		09/28/2012	24,9
Current stop level: Bear mkt low			17,08
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
14,06%	45,78%	27,81%
DOW THEORY PRIMARY TREND MONITOR ETF GDX
			GDX
Bull market started		05/16/2012	39,56
Bull market signaled		09/04/2012	47,77
Last close		09/28/2012	53,69
Current stop level: Bear mkt low			39,56
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
12,39%	35,72%	20,75%

Have a nice weekend.

Sincerely,

The Dow Theorist.