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Mastering Moving AveragesMastering Moving Averages: A Statistical Approach to Enhancing Your Trading Strategy Moving averages (MAs) are one of the most popular tools used by traders and investors to smooth out price data and identify trends in the financial markets. While they may seem simple on the surface, moving averages are rooted in statistical analysis and offer powerful insights into price behavior over time. In this article, we will break down the concept of moving averages from a statistical viewpoint, explore different types of MAs and their benefits, and discuss how they can be effectively used in trading and market analysis. ⯁What is a Moving Average from a Statistical Standpoint? A moving average is a statistical calculation that smooths out data points by creating a series of averages over a specific period. In trading, it is applied to price data, where it helps remove short-term fluctuations and highlight longer-term trends. The core idea behind a moving average is to capture the central tendency of a price over time, providing a clearer picture of the market’s overall direction. By averaging the price over a period, it helps traders see the general trend without being distracted by the noise of daily market volatility. Mathematically, a simple moving average (SMA) can be expressed as: SMA = (P1 + P2 + ... + Pn) / n Where: P1, P2, ..., Pn represent the price points for each period. n represents the number of periods over which the average is taken. The moving average "moves" because as new prices are added to the calculation, older prices drop off, creating a rolling average that continually updates. Types of Moving Averages and How They Are Calculated Different types of moving averages use varying methods to calculate the average, each offering a unique perspective on price trends. Simple Moving Average (SMA) : The SMA is the most basic type of moving average and is calculated by taking the arithmetic mean of the prices over a specified period. Every data point within the period carries equal weight. SMA = (P1 + P2 + ... + Pn) / n For example, a 5-day SMA of a stock’s closing prices would be the sum of the last five closing prices divided by 5. Exponential Moving Average (EMA) : The EMA gives more weight to recent price data, making it more responsive to price changes. The EMA calculation involves a smoothing factor (also called the multiplier) that increases the weight of the most recent prices. The formula for the multiplier is: //Where n is the number of periods. The EMA calculation follows: Multiplier = 2 / (n + 1) EMA = (Closing price - Previous EMA) × Multiplier + Previous EMA For example, for a 10-period EMA, the multiplier would be 2 / (10 + 1) = 0.1818. This value is then applied to smooth the recent prices more aggressively. Weighted Moving Average (WMA) : The WMA assigns different weights to each data point in the series, with more recent data given greater weight. The formula for WMA is: WMA = (P1 × 1 + P2 × 2 + ... + Pn × n) / (1 + 2 + ... + n) Where n is the number of periods. Each price is multiplied by its period's number (most recent data gets the highest weight), and then the total is divided by the sum of the weights. For example, a 3-period WMA would assign a weight of 3 to the most recent price, 2 to the price before that, and 1 to the earliest price in the period. Smoothed Moving Average (SMMA) : The SMMA is similar to the EMA but smooths the price data more gradually, making it less sensitive to short-term fluctuations. The SMMA is calculated using this formula: SMMA = (Previous SMMA × (n - 1) + Current Price) / n Where n is the number of periods. The first period's SMMA is an SMA, and subsequent SMMAs apply the formula to smooth the prices more gradually than the EMA. ⯁Comparing Benefits of Different MAs SMA : Best for identifying long-term trends due to its stability but can be slow to react. EMA : More sensitive to recent price action, making it valuable for shorter-term traders looking for quicker signals. WMA : Offers a middle ground between the EMA’s sensitivity and the SMA’s stability, good for balanced strategies. SMMA : Ideal for longer-term traders who prefer a smoother, less reactive average to reduce noise in the trend. ⯁How to Use Moving Averages in Trading Moving averages can be used in several ways to enhance trading strategies and provide valuable insights into market trends. Here are some of the most common ways they are utilized: 1. Identifying Trend Direction One of the primary uses of moving averages is to identify the direction of the trend. If the price is consistently above a moving average, the market is generally considered to be in an uptrend. Conversely, if the price is below the moving average, it signals a downtrend. By applying different moving averages (e.g., 50-day and 200-day), traders can distinguish between short-term and long-term trends. 2. Crossovers Moving average crossovers are a popular method for generating trading signals. A "bullish crossover" occurs when a shorter-term moving average (e.g., 50-day) crosses above a longer-term moving average (e.g., 200-day), signaling that the trend is turning upward. A "bearish crossover" happens when the shorter-term average crosses below the longer-term average, indicating a downtrend. 3. Dynamic Support and Resistance Levels Moving averages can also act as dynamic support or resistance levels. In an uptrend, the price may pull back to a moving average and then bounce off it, continuing the upward trend. In this case, the moving average acts as support. Similarly, in a downtrend, a moving average can act as resistance. 4. Filtering Market Noise Moving averages are also used to filter out short-term price fluctuations or "noise" in the market. By averaging out price movements over a set period, they help traders focus on the more important trend and avoid reacting to insignificant price changes. 5. Combining with Other Indicators Moving averages are often combined with other indicators, such as the Relative Strength Index (RSI) or MACD, to provide additional confirmation for trades. For example, close above of two moving averages, combined with an RSI above 50, can be a stronger signal to buy than either indicator used on its own. ⯁Using Moving Averages for Market Analysis Moving averages are not just for individual trades; they can also provide valuable insight into broader market trends. Traders and investors use moving averages to gauge the overall market sentiment. For example, if a major index like the S&P 500 is trading above its 200-day moving average, it is often considered a sign of a strong market. On the contrary, if the index breaks below its 200-day moving average, it can signal potential weakness ahead. This is why long-term investors pay close attention to moving averages as part of their overall market analysis. ⯁Conclusion Moving averages are simple yet powerful tools that can provide invaluable insights for traders and investors alike. Whether you are identifying trends, using crossovers for trade signals, or analyzing market sentiment, mastering the different types of moving averages and understanding how they work can significantly enhance your trading strategy. By integrating moving averages into your analysis, you’ll gain a clearer understanding of the market’s direction and have the tools necessary to make more informed trading decisions.
Education
by ChartPrime
3
A Novice's Handbook to Trading Triumph ----- 🙏 In an era where financial landscapes evolve rapidly, venturing into the dynamic domain of foreign exchange (Forex) trading need not be an intricate odyssey. This novella of wisdom unveils the rudiments, steering you through the intricate labyrinth of setting up your financial fortress, handpicking the tools of the trade, deciphering the enigmatic timelines, and sculpting entry strategies with the finesse of an artisan. Navigating the Terrain of Account Setup: Your journey commences by selecting the sturdy vessels of financial exploration, the likes of Coinbase, revered for transmuting mundane currency into the futuristic realms of cryptocurrency. Navigate the seas of connectivity, tethering your accounts to the steadfast anchors of Visa, Mastercard, or the versatile iDeal. Venture further into the undiscovered territories with a seasoned guide – Tradersway, an oracle in the realm of brokers, beckoning with bespoke options for an authentic trading saga. Sculpting the Trading Landscape: Platforms and Tools as Your Artistic Palette Forge your path with MetaTrader 4 (MT4), the canvas for your live trading masterpiece. Unveil the ethereal allure of a Virtual Private Server (VPS), akin to a mythical power-up, enriching your automated trading endeavors. Wander into the meadows of TradingView, where user-friendly charts bloom, and ideas spring forth from a convivial community of traders. Consider wielding the nNouSign indicator, a magical wand for crafting diverse trading strategies. Chronicles of Time: Timeframes for Poetic Analysis For decisions swift as the flutter of a butterfly's wing, gaze upon the 5-minute (5M) and 15-minute (15M) charts, where markets pirouette in perpetual rhythm. Should your ambitions soar higher, ascend to the 1-hour (1H) chart, where profit potential unfurls like a tapestry woven with the threads of time. Crafting Entry Strategies: The Artistry of Navigating Waves In the realm of 5M and 15M, embrace the mystique of the nNouSign indicator on TradingView, intertwining with the 21 Linear Weighted Moving Averages (MA) on the sacred grounds of MT4. Enlist the Williams Percent Range (WPR) at 40, a beacon illuminating shifts and retests. Draw lines, as an artist sketches contours, on both your chart and the WPR canvas for heightened insights. Decipher the harmonies between MA and WPR, directing the symphony of buying and selling. Set the crescendo with Take Profit (TP) at favored peaks or where echoes of prices linger in the corridors of time. The sonnet of 1H unfolds with kindred strategies, casting TP anchors where your heart desires or where the echoes of prosperity resonate. Anticipate the ballet of trends, choreographed by the highs/lows of yesteryears or the harmonious convergence of MA and WPR. Risk Management: Navigating the Seas of Uncertainty As the helmsman of your financial vessel, chart the waters of risk with sagacity. Know the depths you are willing to plunge for the elusive treasures of profit. Let stop-loss orders be the vigilant guardians against tempests, strategically placed to avert colossal losses. For instance, on a £300 expedition trading XAUUSD with a 1:500 leverage, let the StopLoss, a guardian set at 200 pips, stand steadfast at 1987.00 for a buy trade anchored at 1989.00. As you navigate, survey the constellations of currency pairs—those that pirouette in unison and those that waltz in opposing directions. Educational Alchemy: The Chronicles of Wisdom Embark on an odyssey through the scrolls of easily decipherable Forex education platforms. Join the symposiums of Forex communities, where sages share their sagas and novices glean the pearls of insight. Chronicle your journey, the trials, and the triumphs in the scrolls of a journal, an atlas mapping the uncharted territories of your evolving knowledge. Epilogue: 🌹 In the grand tapestry of Forex trading, the loom is not as daunting as it may seem. Armed with the artisan's tools, weave your narrative, learning with every stroke of the quill. Navigate the seas of risk with the astuteness of a seasoned mariner, adjusting your course with each gust of the trading winds. In the realm of Forex, the adventure unfolds not as a tumultuous tempest but as a voyage guided by the stars of knowledge. Bon voyage, intrepid trader! May your odyssey be as prosperous as the markets are ever-changing. ----- ❣️
OANDA:XAUUSDEducation
by ATU_TAD
Chebyshev vs. Butterworth Chebyshev vs. Butterworth Filters: Speed, Quality Factor, and Making the Right Choice Introduction: When it comes to selecting a filter for signal processing, Chebyshev and Butterworth filters are two of the most popular options. Both filters have their unique strengths and weaknesses, and choosing the right one can greatly impact the effectiveness of your signal processing. In this post, we'll explore why the Chebyshev filter is faster than the Butterworth filter and delve into the trade-offs associated with the quality factor of the Chebyshev filter. We'll also provide an explanation of the quality factor to help you make an informed decision. Quality Factor: A Brief Overview The quality factor, also known as the Q-factor, is a dimensionless parameter that represents the "sharpness" of a filter's frequency response. In other words, it measures how well a filter can separate signals with close frequencies. A higher Q-factor indicates a more selective filter, with a steeper roll-off between the passband and the stopband. A lower Q-factor, on the other hand, results in a smoother transition between the passband and the stopband. Chebyshev vs. Butterworth: Speed and Performance The Chebyshev filter is generally faster than the Butterworth filter due to its equiripple frequency response. This equiripple response allows the Chebyshev filter to achieve a steeper roll-off between the passband and the stopband with fewer filter coefficients. Consequently, the filter requires fewer calculations, resulting in faster signal processing. The Butterworth filter, in contrast, is characterized by a maximally flat frequency response in the passband, which results in a slower roll-off between the passband and the stopband. This means that more filter coefficients are required to achieve the desired level of attenuation, leading to slower signal processing. Trade-offs: Quality Factor and Filter Performance The primary trade-off between the Chebyshev and Butterworth filters lies in the balance between the quality factor and the filter's performance. The Chebyshev filter boasts a higher quality factor, which translates to a steeper roll-off and better selectivity. However, this comes at the expense of ripples in the frequency response, which can introduce distortion or signal artifacts. The Butterworth filter, with its maximally flat passband, provides a smoother frequency response with no ripples. This results in lower distortion and signal artifacts but a lower quality factor, which means the filter may struggle to separate closely spaced frequencies. Is the Trade-off Worth It? Deciding whether the trade-off between the quality factor and filter performance is worth it ultimately depends on your specific application and signal processing requirements. If your primary concern is speed and selectivity, the Chebyshev filter may be the better choice. Its higher quality factor and faster signal processing make it an excellent option for applications where steep roll-offs and rapid response times are critical. However, if minimizing signal distortion and artifacts is more important, the Butterworth filter may be more suitable. Its smooth, ripple-free frequency response ensures a cleaner output signal, even if it comes at the cost of a slower roll-off and reduced selectivity. Conclusion: When choosing between the Chebyshev and Butterworth filters, it's essential to consider the balance between speed, quality factor, and filter performance. The Chebyshev filter offers a faster response and a higher quality factor, making it ideal for applications where selectivity and rapid response are crucial. However, its equiripple frequency response can introduce distortion, which may not be suitable for all applications. On the other hand, the Butterworth filter provides a smoother, ripple-free frequency response, but with a lower quality factor and slower roll-off. Ultimately, selecting the right filter for your trading strategy depends on your specific needs and goals. In the world of trading, making timely and accurate decisions is crucial, and the filter you choose plays a significant role in achieving this. Carefully consider the trade-offs between the speed, quality factor, and filter performance when deciding between the Chebyshev and Butterworth filters. By understanding the strengths and weaknesses of each filter type, you can choose the one that best suits your trading requirements and achieve the desired results in your market analysis. Remember that the best filter choice might vary from one trading strategy to another, so always be prepared to reassess your decision based on the unique demands of each trading approach and market conditions.
Education
by The_Peaceful_Lizard
🌀MOVING AVERAGE AND ITS TYPES🌀 ❓Have you ever wondered what moving averages are and how they can benefit your financial decision-making? A moving average is a technical analysis tool that helps you visualize the trend of a particular stock, index or commodity over a specific period. It is calculated by adding together the closing prices of an asset for a certain number of periods and dividing them by that same number. ❗️Moving averages are used by traders and investors to identify trends and potential buying or selling opportunities in the market. There are various types of moving averages that one can use for their analysis. 🧿Simple Moving Average (SMA) The simple moving average is the most common type of moving average, and it is calculated by adding together the closing prices of a particular asset over a specific period and dividing that sum by the number of periods. For example, if you are using a 10-day SMA, you would add together the closing prices over the last 10 days and divide by 10. SMA’s are easy to calculate and interpret, making them popular among traders. 🧿Exponential Moving Average (EMA) EMA is another type of moving average that is widely used in technical analysis. It is similar to SMA, but it weighs recent prices more heavily than older prices, and as a result, it reacts more quickly to price changes. The EMA gives more importance to the most recent prices, making it more sensitive to market fluctuations. As a result, it is more useful in choppy and volatile markets. 🧿Weighted Moving Average (WMA) A weighted moving average gives more weight to recent prices than older prices, similar to EMA, but it differs in terms of its calculation method. Each price is assigned a weight depending on its position in the data series. Unlike the exponential moving average, the weighted moving average is also more suitable for markets with low volatility. 🗝Final Thoughts Moving averages provide a valuable tool for analyzing the market and identifying trends. While there are various types of moving averages, the choice of which one to use is entirely up to you based on your analysis and trading strategy. It is essential to remember that moving averages are just one of many technical indicators that traders use to make investment decisions. I Hope you guys learned something new today✅ Wish you all Best Of Luck👍 😇And may the odds be always in your favor😇 Do you like this post? Do you want more articles like that?
Education
by ProSignalsFx
6
Choosing the Right Moving AverageMastering Moving Averages: A Comprehensive Guide to Choosing the Right One for Your Trading Strategy Moving averages are among the most widely used technical indicators in trading. They serve as a simple and effective way to identify trends, support and resistance levels, and potential entry and exit points for trades. With numerous types of moving averages available, determining the best fit for your trading strategy can be a challenge. In this comprehensive guide, we will delve into the various types of moving averages, their strengths and weaknesses, and when to use them to maximize your trading profits. Simple Moving Average (SMA) The Simple Moving Average (SMA) is the most basic type of moving average. It calculates the average price of an asset over a specific time period, typically 20, 50, or 200 days. The SMA smooths out the price data by creating a constantly updating average price, providing a clear picture of the asset's direction of movement. I personally use the SMA for long-term trading strategies because it offers a more stable picture of the asset's direction of movement. The SMA is also useful in identifying potential support and resistance levels, which are critical indicators for traders. However, the SMA can be slow to respond to changes in price, which can result in missed opportunities for short-term traders. Advantages of SMA 1. Easy to calculate and understand. 2. Provides a stable picture of the asset's direction of movement. 3. Useful in identifying potential support and resistance levels. Disadvantages of SMA 1. Slow to respond to changes in price. 2. Can lag behind the current price action, leading to missed opportunities. Exponential Moving Average (EMA) The Exponential Moving Average (EMA) is a more complex type of moving average that places greater weight on recent price data. This weighting provides the EMA with a more immediate response to price changes than the SMA, making it a popular choice for short-term traders. The EMA is calculated by taking the weighted average of the asset's price over a specified time period, giving more weight to recent prices. Traders use the EMA for short-term trading strategies because it offers a more immediate response to price changes, which is crucial for short-term trades. The EMA is also useful in identifying potential price reversals, support and resistance levels, and momentum. However, the EMA can be more volatile than the SMA, which can lead to false signals and increased risk. Advantages of EMA 1. Provides a more immediate response to price changes. 2. Useful for short-term trading strategies. 3. Helps identify potential price reversals and momentum shifts. Disadvantages of EMA 1. Can be more volatile than the SMA, leading to false signals. 2. May require more complex calculations than the SMA. Weighted Moving Average (WMA) The Weighted Moving Average (WMA) is another type of moving average that places a greater weight on recent prices. Unlike the EMA, the WMA assigns a weight to each price point based on its position in the time period. This means that the most recent prices receive the highest weight, with each price point receiving a progressively lower weight as you move back in time. Traders use the WMA for short-term trading strategies when they want a more sensitive indicator than the SMA. The WMA is also useful in identifying potential price reversals and support and resistance levels. However, the WMA can be more volatile than the SMA, which can lead to false signals and increased risk. Advantages of WMA 1. Provides a more sensitive indicator than the SMA. 2. Useful for short-term trading strategies. 3. Helps identify potential price reversals and support and resistance levels. Disadvantages of WMA 1. Can be more volatile than the SMA, leading to false signals. 2. equires more complex calculations than the SMA. Smoothed Moving Average (SMMA) The Smoothed Moving Average (SMMA) is a type of moving average that applies a smoothing factor to the price data, resulting in a smoother curve. The SMMA places an equal weight on all price data, with the smoothing factor determining the weight given to each data point. Traders use the SMMA when they want a smoother curve to analyze the asset's trend. The SMMA is useful in identifying potential support and resistance levels and entry and exit points. However, the SMMA can be slow to respond to changes in price, which can lead to missed opportunities for short-term traders. Advantages of SMMA 1. Provides a smoother curve for trend analysis. 2. Useful in identifying potential support and resistance levels and entry and exit points. 3. Less sensitive to short-term price fluctuations. Disadvantages of SMMA 1. Can be slow to respond to changes in price. 2. Not as suitable for short-term trading strategies. Which Moving Average Should You Use? The type of moving average you should use depends on your trading strategy and time frame. If you are a long-term trader, you may want to use the SMA or WMA, as they provide a more stable picture of the asset's direction of movement. If you are a short-term trader, you may want to use the EMA or WMA, as they provide a more sensitive indicator of price changes. Additionally, if you are looking for a smoother curve to analyze, the SMMA may be the best option. It is essential to note that moving averages should not be used in isolation. They should be used in conjunction with other technical indicators, such as oscillators or volume indicators, to confirm potential buy and sell signals. It is also crucial to consider the market conditions, such as volatility and liquidity, when choosing a moving average for your trading strategy. How to Combine Moving Averages for Better Trading Signals 1. Use multiple timeframes: Employing moving averages from different timeframes can help you identify both short-term and long-term trends, as well as potential entry and exit points. 2. Use multiple types of moving averages: Combining different types of moving averages, such as the SMA and EMA, can help you identify trend reversals and filter out false signals. 3. Apply other technical indicators: To confirm the signals provided by moving averages, use additional technical indicators like the Relative Strength Index (RSI), the Moving Average Convergence Divergence (MACD), or the Bollinger Bands. Strengths and Weaknesses of Moving Averages Each type of moving average has its strengths and weaknesses, depending on the trading strategy and time frame. Here is a summary of the main differences between the four types of moving averages: 1. SMA: provides a more stable picture of the asset's direction of movement, but can be slow to respond to changes in price. 2. EMA: provides a more immediate response to price changes, making it a popular choice for short-term traders, but can be more volatile than the SMA. 3. WMA: assigns a weight to each price point based on its position in the time period, providing a more sensitive indicator than the SMA, but can be more volatile than the SMA. 4. SMMA: applies a smoothing factor to the price data, resulting in a smoother curve, but can be slow to respond to changes in price. It is important to understand the strengths and weaknesses of each type of moving average to make an informed decision when selecting a moving average for your trading strategy. Conclusion Moving averages are a powerful tool in a trader's arsenal, but choosing the right type can be challenging. The SMA, EMA, WMA, and SMMA each have their advantages and disadvantages, and the one you choose should depend on your trading strategy and time frame. By combining moving averages with other technical indicators and considering market conditions, you can maximize your trading profits. As a trader with experience in using various technical indicators, I've found moving averages to be quite helpful in identifying trends and potential entry and exit points. However, despite the usefulness of moving averages, I personally prefer indicators that use linear regression. The reason for my preference is that linear regression-based indicators, such as the "Regression Envelope MTF", take into account the slope of the trend, rather than assuming that the trend is linear. This means that the bands will adapt to the slope of the trend, providing more accurate signals in trending markets. For instance, I typically use the "Regression Envelope MTF" (one of my indicators that I have just recently published) on the daily chart with a parameter setting of 250 periods. This allows me to quickly see where the price is positioned relative to the past year's trend. I find this approach to be particularly insightful and beneficial for my trading decisions. Remember to always use caution when trading, and never risk more than you can afford to lose. It is also essential to continue learning and refining your trading strategies to stay ahead of the curve and become a successful trader.
NASDAQ:AAPLEducation
by Julien_Eche
MOVING AVERAGES MADE SIMPLE Moving averages are commonly used to analyze and forecast trends in financial data. There are several types of moving averages, including: Simple Moving Average (SMA): This is the most basic type of moving average. It calculates the average price of a security over a specified number of periods. Weighted Moving Average (WMA): This type of moving average assigns a weight to each period's price, with more recent prices given greater importance. Exponential Moving Average (EMA): This type of moving average puts greater weight on more recent prices and adjusts the weighting based on the volatility of the prices. Smoothed Moving Average (SMMA): This type of moving average is similar to the EMA but uses a different formula to calculate the weighting. Hull Moving Average (HMA): This type of moving average uses weighted averages to reduce lag and improve responsiveness to price changes. The choice of moving average type depends on the specific application and the trader's preference. EXPLANATION ON HOW EACH WORKS. Simple Moving Average (SMA): Imagine you have a toy car that you play with every day for a week. At the end of each day, you write down how far the car traveled. The simple moving average is like adding up all the distances the car traveled and dividing by the number of days you played with it. This gives you an average distance the car traveled each day. Weighted Moving Average (WMA): Now, imagine you have another toy car that you play with every day, but you like to give more importance to the distance it traveled on the most recent day. The weighted moving average is like giving more weight, or importance, to the distance the car traveled on the most recent day when calculating the average. Exponential Moving Average (EMA): The exponential moving average is like the weighted moving average, but it puts even more importance on the most recent day's distance. This means that the average changes more quickly when there are big changes in the price. Smoothed Moving Average (SMMA): The smoothed moving average is like the exponential moving average, but it uses a slightly different formula to calculate the average. It's a way of smoothing out the bumps in the price and making it easier to see the trend. Hull Moving Average (HMA): The Hull moving average is like the smoothed moving average, but it tries to reduce the time lag between the price changes and the moving average. It's like having a toy car that responds more quickly to your movements when you're controlling it with a remote. So those are the different types of moving averages! They all have different ways of calculating the average price over time, and they can be useful for different things depending on what you're trying to analyze. CROSSING OF MOVING AVERAGES The crossing of moving averages is a popular technical analysis tool used to identify potential changes in the direction of a trend. A moving average is calculated by taking the average price of a security over a certain period of time. Traders often use two moving averages, one short-term and one long-term, to look for potential changes in the trend. When the short-term moving average crosses above the long-term moving average, it is called a "golden cross," which is a bullish signal that suggests the price may be moving higher. Conversely, when the short-term moving average crosses below the long-term moving average, it is called a "death cross," which is a bearish signal that suggests the price may be moving lower. Here's an example to help explain: Let's say we have a 50-day moving average and a 200-day moving average. If the 50-day moving average crosses above the 200-day moving average, it's a golden cross, indicating that the short-term trend is turning bullish, and it could signal a potential upward price movement. Conversely, if the 50-day moving average crosses below the 200-day moving average, it's a death cross, indicating that the short-term trend is turning bearish, and it could signal a potential downward price movement. The crossing of moving averages can be used in conjunction with other technical indicators and analysis to help traders make more informed decisions when buying or selling a security. It's important to note that no indicator is foolproof, and traders should always consider other factors such as market conditions, fundamental analysis, and risk management before making any trading decisions. INFLICTION POINT VS CROSSOVER An inflection point is a point on a graph where the curvature, or shape, of the line changes. It is a point of transition between a curve that is bending upwards and one that is bending downwards, or vice versa. In other words, it's a point where the rate of change of a function changes from positive to negative or vice versa. On the other hand, the crossing of moving averages is a technical analysis tool used to identify potential changes in the direction of a trend, which is based on the relationship between two or more moving averages. While the crossing of moving averages may sometimes coincide with an inflection point, they are two distinct concepts. HOW YOU SHOULD USE MOVING AVERAGES 🔸Trend identification: Moving averages can help traders identify the direction of the trend. For example, if the price of a security is consistently trading above a moving average, it can indicate an uptrend, while trading below the moving average can indicate a downtrend. This information can be useful in determining entry and exit points for trades. 🔸Support and resistance levels: Moving averages can also help identify potential support and resistance levels. In an uptrend, the moving average can act as a support level, while in a downtrend, it can act as a resistance level. Traders can use these levels to help determine their risk and reward when placing trades. 🔸Momentum indicators: Moving averages can be used as momentum indicators to help identify the strength of the trend. A short-term moving average crossing above a long-term moving average can indicate bullish momentum, while a short-term moving average crossing below a long-term moving average can indicate bearish momentum. 🔸Trading signals: Traders can use crossovers of moving averages to generate buy and sell signals. For example, a bullish signal is generated when a short-term moving average crosses above a long-term moving average (golden cross), while a bearish signal is generated when a short-term moving average crosses below a long-term moving average (death cross). 🔸Moving averages can be used to clearly see trend waves by smoothing out price data over a specified period of time. This can help traders identify the direction of the trend and the strength of the momentum in the market. When using moving averages, it's important to consider other factors such as market conditions, fundamental analysis, and risk management. Traders should also experiment with different types of moving averages and time periods to find what works best for their trading strategy.
Editors' picks
PEPPERSTONE:ETHUSDEducation
by ChristopherDownie
55
The Ultimate Beginner’s Guide To Trend TradingMany traders utilize forex trend trading specifically to increase their profits from currency exchange. The possibility to take a big number of pip moves due to a strong, directional price movement, a high probability of profit, and exceptional signal accuracy are only a few of the benefits of trend trading. These are the factors that make trend trading possible for traders. In order to maximize price movement and minimize mistakes—which, no matter how hard one tries, will still happen occasionally—have let's a look at the fundamental algorithm of trend trading. What is a Trend? A trend involves a tendency for price to rise or fall over some time. There are two types of trends - bullish and bearish. In a bullish trend, the price makes high bases and higher tops. Thus, the trend line during a bullish trend acts as support. Bearish trends are the opposite of bullish trends. In this case, creates lower highs and lower lows on the chart. In this case, the bearish trend line can be drawn through the highs. There are various trend indicators, but one of the easiest and most effective ways to analyze trends is to use trend lines. A trend line is a diagonal line on a chart that connects several peaks or bases on the chart. The main function of a trend line is to act as support or resistance for price movement. We see a bearish trend line that acts as a resistance line when the price is moving down. The arrows point to places where the price is testing the trend line as resistance. On the seventh price interaction with the bear trend, we get a bullish breakout. Price closes above the bearish trend line, implying that the trend is broken out and price direction is likely to change. In a trending market, two types of systematic price movements are important for understanding the trend. These two types of price movements are called momentum and corrections. A trend momentum is a price movement that occurs after interacting with a trend line and after the price bounces in the direction of the trend. Trend momentum leads to large price movements over a relatively shorter period. Corrective price movements follow the momentum and return the price to the trend. A correction on the chart is not as attractive to trade. Traders without sufficient trading experience should stay out of the market when the price is in a correction phase. The reason for this is that corrections are relatively smaller and often last longer than momentum. As you can see, price registers higher highs and higher lows, indicating that there is a bullish trend on the chart. Note that trend momentum leads to relatively large price movements in the direction of the trend. The third correction on the chart has about the same duration as the last momentum and later leads to a trend breakout. How Do You Find Trends? We already know that an uptrend consists of ascending highs and lows. And a downtrend consists of descending highs and lows. But what if you see a chart that looks like this? Is it the end of a downtrend and the beginning of an uptrend? Or is the price in a trading range? There is a problem in determining trends if you use higher highs and lows - this approach will always be subjective. So use a 200-period Moving Average (MA) to determine exactly what the trend is in the market right now. Depending on the time frame, the market can move in different trends. Downtrend on a Daily chart. UPtrend on a Daily chart. It would be a mistake to try to trade trends in different time frames. Instead, focus only on the main time frame and trade only in it. However, your trend trading can improve if you analyze charts of different time frames. What types of trends are there? Most traders believe that a trend consists of higher highs and lows. But that's not enough, because trends come in all kinds of forms. Some are better to trade with breakout strategies and some are better to enter only on pullbacks. There are three types of trending markets, which we will get to know. Strong Trends Buyers control the price and it is moving steadily upwards, there is only a little pressure from the sellers. This type of trend will have small pullbacks - around the 20MA level. In some cases, this type of trend will be so strong that it will move up without any pullbacks. It will not be easy to enter this type of trend because corrections will be too weak or there will not be any. So, the best thing would be to try to catch this type of trend at the beginning of its movement and enter it on its breakdown. If the trend has already gained strength, it is possible to switch to a smaller time frame and look for entry points on the pullback there. Regular Trends Buyers are still in control of the price, but sellers are more active. This is due to someone locking in their profits or entering against the trend. This type of trend will have pullbacks to the 50 MA level. Regular trends can also be entered on a level breakout, but you must be prepared psychologically to withstand a possible strong pullback to the broken level. You can always enter this type of trend later on its pullback to 50 MA. Weak Trends Buyers and sellers are fighting for control, with the buyers slowly starting to gain the upper hand. Price will move in large pullbacks beyond the 50 MA. Soon the previous trend may change direction. Therefore, the best strategy is to enter the market at support and resistance levels. Where Should I Place a Stop Loss in Trend Trading? There are three logical places to place Stop Loss in trend trading: behind the Moving Averages, behind the previous pullback, and the dynamic trend lines. Moving Averages In a market with a strong trend, the price tends not to go over 20 MA. Thus, you should put your Stop Loss below 20MA. If the trend is calmer and does not go behind the 50 MA, place your Stop behind the 50 MA line. Previous pullback You can always place a Stop Loss below the boundary of the previous pullback of the trend. Trend lines To avoid false triggering of your Stops, you can use the technique of placing a Stop Loss at a distance of one or two ATRs from the Moving Averages, the previous pullback, or the trend lines. Then your potential losses can increase, but your Stops will be well protected from accidental price spikes. Peculiarities of Trend Trading Before you start trend trading, you must first recognize a potential trend. Experienced traders will tell you that "The trend is your friend!" because the profits from a trending instrument are much higher and such trades can involve less risk. Let's discuss a few trading techniques for potential trends on the chart. As we already know, if the highs and lows of price are rising, we are in a bullish trend. If the highs and lows are decreasing, we are in a bearish trend. In all other cases, we have no trend conditions. Every two points on the chart can be connected by a straight line. However, if the third point is on the same line, then we have a trend. Thus, trend confirmation usually comes after price tests the trend at the third touch and bounces off of it. When you see the bounce, you can enter the market trying to catch the new trend. Different Approaches to Trend Trading Trend trading can be divided into two approaches: Systematic trading; Discretionary trading. Systematic trading Systematic trading clearly defines all the rules you must follow in your trading: entry point, profit taking place, risk management, and trade management. Most of these actions can be automated by building automated models that are based on technical analysis with limited intervention by the trader. This approach is widely used by large hedge funds. The trader can only determine the level of risk and markets to be traded. Discretionary Trading Discretionary trading has less clear-cut rules that a trader must follow. This approach requires constant participation in trades and is widely used by individual traders. Although discretionary trading is more subjective, it is still based on a trading plan. Trend Trading Strategy A trading strategy for trend trading is only 1/3 of the component of your success. Without proper risk management and discipline, even the best trading strategy will not help you trade profitably. To develop a trend trading strategy for yourself, you will have to answer the following questions: What time frame will I use? What will be my risk level for each trade? What markets will I trade? Where will be my entry point? Where will I exit if the price goes against my position? Where will I take my profits if the price goes my way? In practice, it would look something like this: If the price is above the 200 Moving Average, the trend is uptrending. In an uptrend, we expect two price touches in the area between the Moving Averages with periods of 20 and 50. We open a long trade on the third test. Stop Loss will be placed at a distance of 2 ATR from our entry point. If the price goes in your favor, the trade will be closed when the price closes outside the 50 MA. Alternative scenario: If the 50 EMA is above the 100 EMA, look for an opportunity to open a long position. We wait until the price closes above the 50-day high. If the price closes above the 50-day high, we open a trade on the next candle. Stop Loss is placed at a distance of 3 ATR from the last price maximum. Never move Stop Loss against your position. Trade as many markets with low correlation as possible. Risk no more than 1% of your capital on any single trade. Trading Pullbacks: How to Enter the Market with the Trend? A pullback is a short-term price movement against a trend. What are the advantages and disadvantages of trading on a pullback? A pullback gives us a good entry point with a good risk/reward ratio. However, we can miss a strong trend because sometimes trends move for a long time without a pullback. We also trade against the current price momentum. Since most trading instruments stay within range boundaries or consolidation phases most of the time and market trends are only seen about 20-30 percent of the time, finding a settled trend and a good pullback can be a challenge. As a trader who trades on pullbacks, you have to act like a sniper. You have to wait, then wait some more, sometimes for hours, if not days, before you enter the market. You need to find the entry point at which the price is likely to resume its movement in the prevailing trend. Here are the three basic steps you need to take to successfully trade pullbacks with the trend: Identify an existing trend. Identify potential reversal areas or market conditions where the price may resume its trending movement. Find a high-quality trading signal to enter the market that involves a high risk/reward ratio. Pullbacks and Trend Trading We have already mentioned the wise axiom "the trend is your friend." However, professional traders also know that the trend is your friend "until it ends." Most of the time, financial markets remain in equilibrium, where major market participants have access to all the major news events and information. As a result, the price fluctuates slightly during the day, but in the absence of any new information, it usually does not make a particularly strong directional move. However, after the release of important news, if the actual data diverges from the market consensus, we may see sharp price movements because this is where the market tries to interpret the new information to find a new equilibrium. Bulls and bears sometimes have unique interpretations of news data, and they are invested in their interpretations. When most market participants or even a few large institutional players think the price should rise or fall, this kind of supply and demand imbalance can cause prices to spike or fall. You can see how pullbacks approach the previous consolidation zone and serve as price reversal points on the chart. Pullbacks often test previous support and resistance levels. Since traders know that these levels previously acted as anchor points, a large number of pending orders are accumulated around these price levels. As a result, when the pullback reaches these price levels, and if there have been enough orders in the direction of the trend, the market resumes its movement. Otherwise, the support or resistance levels are violated and a trend reversal may occur in the market. While it may be relatively easy to identify a trend, measuring the likelihood of a trend continuing after a pullback, is a bit more difficult. Nevertheless, it is quite possible if you apply the right technical analysis tools and have a comprehensive strategy for trading on pullbacks. For most new traders, it is best to trade on pullbacks rather than looking for countertrend opportunities. What is a Pullback? It is impossible to predict 100% when a pullback will end. But it has to be based on something. It can't just hang in the air. It may be: -A previous resistance level becomes support. -Resistance becomes support. -Support that became resistance. -Support becomes resistance. -Dynamic trend lines. -The pullback to the dynamic trend lines. -Confirmation for entry into the trade we get when the candle closes in the direction of the current trend. This increases the positive probability of our trade. However, sometimes this can cause you to miss a good trend movement. So there is no definite answer here: to wait for a confirming candle or not. If the price is above the 200 EMA then the trend is bullish. Wait for the price to return to its support area. Then expect a bullish candle in the direction of the trend. Place a Stop Loss below the low of a reversal candle. Take Profit at the nearest level. The best entry points will be called structural - these are places where several conditions for entering the trade will coincide. The price has approached the resistance level, which previously acted as support. The price touches dynamic trend lines. A bearish pin bar appears. The price touches a strong support level. The 200 EMA also passes at this point. An absorption pattern appears. The more structural factors combine in one place on the chart, the greater the probability of a profitable trade. However, the number of such sets with all structural factors will be quite small. Therefore, it will be best to find a balance and enter the market with 2 to 4 structural factors. Trend Trading Strategy on Pullbacks The first step is to recognize the trend. If the price is making higher highs and higher lows, we are seeing an uptrend. On the other hand, if the price makes lower highs and lower lows, we are seeing a downtrend. You can also use the two Moving Averages and confirm the trend when there is a crossover between them, and use them to confirm a pullback. The instrument is in an uptrend. By adding two Moving Averages, the 13-period EMA and the 21-period EMA, we can get additional confirmation. When the fast EMA crossed the slow EMA, we could see a pullback. Remember, however, that the Moving Average crossover acts as a lagging indicator. By the time it generates a signal, the market may have moved slightly in the direction of the prevailing trend. As a result, the risk/reward ratio in your trade may also increase. Consequently, it would be much better if you tried to identify a potential reversal area during a pullback and place your trades using more efficient methods to enter the market based on price action signals. One of the main principles of technical analysis is that old resistance turns into new support and old support turns into new resistance. Using this principle, you can quickly determine where the market may reverse during a pullback. Old support and resistance levels provide a great place to place your limit orders on the side of the prevailing trend. You can also use another time-tested entry method. In this case, we are referring to the use of major Fibonacci retracement levels. After the first uptrend, the price pulled back to the 23.6% Fibonacci level and then resumed the uptrend. After the second uptrend was completed, the price pulled back to the Fibonacci 38.2% Fibonacci recovery level, after which the trend resumed. Major Fibonacci levels act as hidden support and resistance zones in the market. Once you have learned how to successfully identify the trend, the pullback, and the potential area where the pullback may end, you can look for an entry point into the market. A simple pin bar or outside a bar near previous support or resistance, or near a Moving Average, can be an excellent confirmation that a pullback is ending and the trend is about to resume. When the Moving Average and the downtrend line intersect, it confirms that the market is in a downtrend. Once the downtrend was confirmed, you could tell that the 1.5750 level was acting as significant resistance as the price bounced back from that level several times. However, instead of blindly entering the market near the reversal, we waited for a bearish pin bar, which confirmed the end of the pullback. Trend Trading Strategy with MACD, Trend Line, and Volume Indicator The MACD indicator consists of two Moving Averages, which interact with each other above and below the 0 levels. When the faster line overcomes the slower line in a bearish direction, being above 0, we expect the price to start trending in a bearish direction. When the faster line overcomes the slower line in the bullish direction, being below 0, we expect the price to start trending up in the bullish direction. The MACD also has a histogram. This histogram shows the exact difference between the fast line and the slow line. If the histogram is positive, the faster line is above the slower line, the long signal. If the histogram is negative, the faster line is below the slower line, the short signal. Divergence is also good for determining the divergence between the price and the indicator. If the price increases and the MACD decreases, we have a bearish divergence, which indicates that the trend is likely to reverse. The same is true in the opposite direction for a bullish divergence pattern. If the price is declining and the MACD is increasing, we have a bullish divergence. One way to trade trends is to combine the trend lines, MACD, and volume indicator. We can try to match signals from the MACD indicator and a potential emerging trend line and perform a volume analysis. Imagine that you see an upward price movement on the chart. At the same time, the MACD is signaling a bullish crossover below 0, which confirms that the price is rising. In this case, we can expect a continuation until we see the opposite signal from the MACD. A Stop Loss should be placed below the recent swing low. The same technique works for bearish trends. If the price starts to consider lower tops and lower bases, we use a bearish MACD cross above 0 to open a short position. The chart begins with a bullish MACD crossover. Note that during the crossover and continuation thereafter, the price is in a range. However, during the horizontal movement, trading volumes are constantly increasing. Suddenly the price creates a higher top, breaking the level of the previous top. This indicates a possible rise in price, and after a short correction, there is an opportunity to open a long position. The price continues to rise with two momentum movements and their corresponding corrections. The MACD indicator is now in its upper area, indicating that we may see the end of this bullish trend shortly. Nevertheless, the position should be held until the MACD lines show a bearish crossover as indicated in the trading strategy. Tips for Trend Trading In order not to be deceived, do not use time frames lower than H1. Most often in M1, M15, etc. we just see market noise, imitating a storm of market activity, and changing many times a day. Always check the trend you have detected in a higher time frame (for example, if you see a bullish trend on H1 - switch to D1 and check your conclusions). If the trends coincide - good, this is a signal for entry, if they diverge - do not enter the market. Professionals use trends that are evident at least on the semi-annual chart, even better - the annual chart (it is visible on W1). The rule is simple: a true, time-tested trend does not change quickly and focusing on false trends and breakouts - is counterproductive and unprofitable. Having chosen a trend - be faithful to it, to a reasonable limit. Do not react to the usual market volatility, "chattering", constantly provoking you to the wrong actions. Allow profits to grow. For example, all of 2017 EUR/USD was in a bullish trend, and traders who were able to use this (simple, in general) understanding - made good profits. If you still went against the trend - you need to know how to "flip". If the price goes more than 200 pips against your open positions - can't be helped, there is no arguing with the market, open in the right direction, take a loss (liquidate a losing position) and earn more than you lost. Summary When trend trading, be sure to include economic news in your arsenal. Using only technical analysis will not give a complete picture of what is happening on the market. Use trend trading and you will see that forex really brings profit. And of course to be successful with trend trading you need practice and remember that profitability depends very much on the broker you choose!
Education
by FOREXN1
18
Chart Training with Jay Rhyder - MA SignalsHello and welcome to a small series I thought I would start to help people understand market charts. Enjoy and leave me a comment about what you liked or didn't like. Thank you for your support! ------------------------------------------------------------------------------------------------------------------------------------------------------------------ Take a look at this chart. It is a 1 hour Coinbase chart of Ethereum (ETH/USD). One of the best ways to understand if the market is going to rally or go south is to pay attention to the MOVING AVERAGES, or MA lines. As you can see, the white line on this chart is the 50 day, the dark purple one is the 200 day and the pink one is the 150 day moving average, respectfully. When you see the 50 day moving up like in this chart, and the 200 day on top of the 150 day, it is a bullish signal. The opposite is true for bearish markets. It is called a DEATH CROSS. It is when the 50 day is on the bottom of the 150 and 200 and the 200 day is on top of the 150 day moving average. When the 200 day crosses DOWN through the 150 day, it is called a DEATH CROSS and is a very, very bearish signal. If you have any questions about this short and concise tutorial, please leave your question or comment below. I hope you learned something from this short tutorial. My name is Jay - have the best day! :)
COINBASE:ETHUSDEducation
by financetrance
1
EDUCATION - Moving Average Trading Tutorial ⚡⚡What is a Moving Average? In technical analysis, there’s an indicator called moving average which calculates the average closing price over a set period of time. If the market is too choppy, often a moving average can help smooth things out and provide a clearer visual of what’s going on in the market and an indication as to where the momentum is whether it’s a bear market or a bull market. How is moving average calculated? A moving average is calculated by calculating the closing prices and then divided by the set number of days e.g. 100 day moving average takes into account the closing prices for the last 100 days and then divides it by 100 to give you the moving average. Once you have enough data, you will be able to plot a smooth line which you can use to help with your analysis. How do you use moving average? In very simple terms: if the price is above the moving average, you can assume that the market is bullish. If price is below the moving average, you can assume that the market is bearish. The way we use the moving average is that we see it as dynamic resistance/support. Dynamic support – When price is above the moving average and approaches it, the moving average will act as a support base where price could potentially bounce off. Dynamic resistance – when price is below the moving average, price may come up to reject the moving average before moving lower. Transition from bearish to bullish (vice versa) We found that one of the most probable moments where the moving average acts as a dynamic support/resistance is when price impulses through the moving average and then retests it. It is possible to gain an entry on the retest provided there are other confluences playing a part such as previous structure or price action. What moving average do we use? 100 and 200 moving average. Examples
Education
by Altsignals
4
Education excerpt: Simple Moving AverageSimple Moving Average (SMA) The origin of inventing the Simple Moving Average (MA) is not clear. Although, some of the first documented cases of its use date as far back as the early 20th century. Implementation of moving averages in technical analysis is one of the most successful methods of identifying trends. Moving averages are simply constant period averages - usually of prices, that are calculated for each successive period interval. The result of calculation is then plotted on the chart as a smooth line that represents successive average prices. Thus, the calculation of the moving average dampens fluctuations of price of an asset, making it easier to spot an underlying trend. Though use of the moving average goes beyond identifying trends. Support, resistance and price extremes can be anticipated by correct interpretation of the moving average. Different lengths of moving average directly translate to the amount of data used in the calculation. Including more data in the calculation of the moving average makes each data per time interval relatively less important. Therefore, a large change in one particular data would not have as large an impact on the overall result of the calculation in comparison to if the moving average with a shorter period was employed. Hence, the longer moving average produces less false signals at the cost of revealing underlying trend sooner rather than later. Usually, the use of two moving averages with different period intervals is encouraged as opposed to use of a single moving average. This comes from the premise that when two moving averages with different period intervals are plotted on a chart, they tend to show two separate lines converging and diverging. Generally, when the moving average with a lower period interval crosses above the moving average with a higher period interval it is considered a bullish signal. On the other hand, when the moving average with a longer period interval crosses above the moving average with a lower period interval it is considered a bearish signal. These crossovers can serve as specific buy and sell signals in markets that are trending. However, moving average crossovers tend to produce many false signals in non-trending markets. Furthermore, these same crossovers can act as support or resistance levels. Calculation and formula The calculation of the moving average usually involves use of the close price. Normally, 10, 20, 50, 100 or 200 periods are used and the calculation is conducted by creating the arithmetic mean of a dataset. SMA = (A1 + A2 + An) : n A = average in period n n = number of time periods Illustration of weekly chart of DAI: Red line = 50-day SMA Green line = 20-day SMA Disclaimer: This is just excerpt from our full text. This content is not intended to encourage buying or selling of any particular securities. Furthermore, it should not serve as basis for taking any trade action by individual investor. Your own due dilligence is highly advised before entering trade.
DEducation
by Tradersweekly
3
Always Wait For Confirmations 📚 Those who win at the Forex game are those who are able to build on their case to take a trade, whether it be fibonacci, moving average, patterns etc. The more confluence, the better. This is why it is important to always wait for your confluences to line up before taking a trade. For this particular trade, those who were waiting for the third touch of the upper resistance of the pattern, would've been stopped out if they had a tight stop loss. It would've been better to wait for more of your confirmations to line up so you can execute the trade knowing that there are more things on your side (other than chance!) See below for the current GBPNZD set up.
Education
by WicktatorFX
7
Tilson Moving Average (T3)T3 is one of the most accurate moving averages developed by Tim Tilson. Tilson Moving Average (T3) is a trend indicator with the advantage of having less lag than other ones. That is, a faster moving average. T3 is considered superior to traditional moving averages as it is smoother, more responsive and thus performs better in ranging market conditions as well. The T3 moving average is an indicator of an indicator since it includes several EMAs of another EMA. Unlike any other moving average, it also adds the volume factor. Tim Tilson is designed another superb movinh average called IE2 which integrates the linear regression into it.
Education
by ICFX
2
200 EMA - best use for entries!I don't use indicators, they're not my style, they lag, they repaint; and in my opinion they don't work. The 200 EMA on DAILY can be useful because of how slow it is. We can use it to filter the direction of which way we trade. Price ABOVE 200 ema = ONLY BUY Price BELOW 200 ema = ONLY SELL Then drop timeframes for your entries via your strategy whatever that may be. If your strategy says go long but price is below EMA, don't take the trade etc... Ignore the EMA on other timeframes lower than the daily. You want a slow daily direction indicator. Don't blindly trade this, wait until price is clearly past the EMA and maintaining a good distance from it. Use it as a guideline if you struggle working out fundamentals to help you filter a direction to trade. NOT TO REPLACE FUNDAMENTAL ANALYSIS!!!
Education
by joebrownFX
EDUCATIONAL STRATEGY 21>50>250 BUY, 21<50<250 SELLHELLO, HERE IS A BEAUTIFUL MA STRATEGY, HOW TO SET IT UP? 1. LOAD MA 21, Linear Weighted, HL/2 (Colour WHITE) 2. LOAD MA 50, Linear Weighted, HL/2 (Colour RED) 3. LOAD MA 250, Linear Weighted, HL/2 (Colour YELLOW) SIGNALS. 1. MA 21>MA50>250 WE BUY, WE CLOSE WHEN MA 21MA50 Extra, 1. MA 50> MA 250 CONFIRMED UP TREND. GOLDEN CROSS. ONLY TAKE BUY SIGNALS 2. MA 50< MA 250 CONFIRMED DOWN TREND. DEAD CROSS. ONLY TAKE SELL SIGNALS EARLY SIGNAL. 1. SELL EARLY: MA21 < MA50 ( BUT WE ARE IN UP TREND WHERE MA 50 > MA250) 2. BUY EARLY: MA21 >MA50 ( BUT WE ARE IN DOWN TREND WHERE MA 50 < MA250) WHAT TIME FRAME SHOULD I USE? H1, H4, M15,M5. What DO I DO WHEN 21MA=50MA=200Ma? DON't ENTER, WHAIT CONFIRMED TREND AND CROSS THEN ENTER. WHAT PAIR SHOULD I USE THIS? ALL CURRENCY AND STOCK. CAN I ADD ANOTHER INDICATOR? YES, ADD PARABOLIC SAR TO GIVE YOU BUY OR SELL SIGNAL WITH THIS STRATEGY. IS THE STRATEGY BEST FOR TREND OR RANGE? BEST FOR TREND, USE M5 TIME FRAME FOR RANGE. THANK YOU ALL, PLEASE LIKE IF YOU BENEFIT SO WE ADD MORE EDUCATIONAL TIPS. ACCOUNT MANAGEMENT SERVICE 0096594072143 WHATS UP.
TVC:USOILEducation
by SignalsView