Dissecting The Dow Jones Industrial Average For Market Direction

technical lookSteven Bauer: Forecasting the General Market for me is fun. I use my Cycle Analysis and Forecasting Methodology along with the 30 Dow Industrial Component Companies and their respective Industry Groups. I use the same procedures with several broader based indices for verification and comparative analytics. With a brief narrative and rather simple graphics / charts, I will attempt to share how I go about getting consistently positive results.

My monthly composite article for all 30 of the Dow Companies can be read here.

Cycle Analysis for me means identifying Bullish and Bearish Primary and Secondary Inflection Points for the General Market, Sectors, Industry Groups, Commodities, Companies and ETFs. Yes, it can be done and this series articles will share how I go about the task. My article and graphic on Cycles may be of interest.

Forecasting is a tool that I use primarily because it offers me what I call “lead time.” That means, I have time to “Cherry Pick” the Best of the Best for Bullish Cycles and the Worst of the Worst for Bearish Cycles.

I have chosen the Dow 30 Industrial Companies to share with you, because it is the easiest job you can give to a financial analyst. That is because there is an over-abundance of accurate information and data available for each Company. In today’s world, the Dow 30 has more words published each day than a person can possibly absorb. One comment about the above “accurate information” remark: One of the biggest problems in the Marketplace today (and getting worse) is the false and misleading information disseminated by many companies, Wall Street, the financial media and a few peer bloggers.

The Dow 30 represents about 33% of the total market-cap of the world’s universe of companies. At present, the NYSE has about 3,200 listed companies to choose from. And, the Nasdaq sports about 6,000 companies. My Universe of ETFs is over 250 strong covering most all Indices, Sectors and Industry Groups.

The five Dow components I will forecast in this article are listed in the table below. I hope in conjunction with the supporting graphics / charts you will quickly come to understand how I go about using my Fundamental Valuation and Technical Analysis procedures to do my Cycle Analysis and Forecasting and hence, provide my clients with ongoing and timely guidance and direction.

My Unique Dow Chart w/ Commodities and My I. P. Counts

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I update the Graphic / Chart every Saturday morning.

Percent Chart for Perspective

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Combining my Fundamental – Valuations with my Technical Analysis always provides a clear perspective of the Best of the Best for Bullish Cycles and the Worst of the Worst for Bearish Cycles.

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