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Charles Dow published his articles in the early 1900’s. These published contents came to be quite popular within a short range of time. People from different parts of the world valued the theory and applauded his work. Even more, many of the businesspersons who made his theory a practice were highly satisfied and benefited in their business.

Consequently, his technical analysis became popular quickly and people all over the world soon started recognizing him as one of the magicians of profitable business. Accordingly, Dow trading became a popular practice in the world of forex trading. His concepts of trends impressed people a lot and at the same time, they followed his theory whole heartedly. However, this theory became redundant within a little time and surprisingly was no more magical and in practice like before. There were several reasons beyond this sudden infamy of the Dow Theory.

Basically, the reason behind it was the drawbacks of the consisting theory. The basic idea of Dow’s theory was a combination of Dow Jones transportation and industrial averages that could be applied to forecast business cycles. The concept of “smoke stacks” has been highly replaced by the “service” economy on the whole. In addition to this, the theory became redundant as instead of steel, mining, and chemicals; present market is blooming with software, finances, and amusement as our prime investment criteria. Secondly many day trading software are also available. In short, it time has reduced the value of this existing theory of Charles Dow. The correlation between transportation and industries is less than earlier, and here lays the basic shortcoming of the theory.

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