Dow theory

proper noun

A theory of stock price movement, according to which the market has three types of movement, market trends have three phases, prices reflect information published in the news, market averages must confirm each other, trends are confirmed by volume, and trends exist until definitive signals prove that they have ended.

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Meanings

proper nounthe Dow theory
  1. businessA theory of stock price movement, according to which the market has three types of movement, market trends have three phases, prices reflect information published in the news, market averages must confirm each other, trends are confirmed by volume, and trends exist until definitive signals prove that they have ended.

Origin

The theory was derived from Charles H. Dow's editorials in The Wall Street Journal.

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Cite this entry
APA

Dow theory. (n.d.). In WatkinsX Dictionary. Retrieved November 4, 2026, from https://dictionary.watkinsx.com/word/Dow%20theory

MLA

“Dow theory.” WatkinsX Dictionary, https://dictionary.watkinsx.com/word/Dow%20theory. Accessed November 4, 2026.

Chicago

WatkinsX Dictionary, s.v. “Dow theory,” accessed November 4, 2026, https://dictionary.watkinsx.com/word/Dow%20theory.

Source: Dow theory on Wiktionary, CC BY-SA 4.0.