DataTrek Co-founder Nick Colas‘ latest piece for Bloomberg Prophets on how to use the Dow to assess trade tariff risks:
“The Dow Theory was one of the first attempts to decode stock market price signals and make them useful to traders and investors.
The idea is straightforward: Stock price trends should show logical and fundamental consistency across industries. Volume confirms price. And, most important, equity prices move in long-term patterns. More than 100 years after the theory was developed by Charles H. Dow, traders still adhere to its basic tenets.
These time-proven rules can be adapted to a new problem: how to track the market’s worry over the possibility of a global trade war. After decades of increasing globalization, investors do not have much of a map for this journey”….
Read the rest here on Bloomberg!