I noticed there is one simple way to stay on the right side of price action. Moving averages! There is one simple, but important modification (and understanding of the logic behind them) that needs to be made to them to be worth a lick. This sounds like a newb thread, but it's more like I have read from Redneck....going around full circle back to where I began. If you aren't comfortable sharing please PM me your thoughts. This seems like a simple but effective way to pick up the middle area of ranges....with the ability to automate as well. Thanks. BD
they don't work. what you see in hindsight looking backwards on a chart is NOT what you see unfolding in real-time when it matters. moving-average crossovers are a siren song... don't work. lag trend session moves and chop to pieces during sideways periods of price consolidation learning to read = measure price action itself is the only path to success.
That's a bit harsh. I think it is fairer to say that they work when they work and they don't when they don't. That reduces the problem to determining when they do and don't work. THAT'S what doesn't work. So BD, repeat after me: "If it were that simple we would..."
Who says they have to be lagging in the traditional sense? That is my point. Since no one understands or seems to care what I am writing perhaps I will post a chart with simple enter/exit criteria for the masses (well maybe not masses ) unless anyone objects... Shorter durations lead longer durations. Why not just look at what PRICES are telling you as opposed to focusing in on one bar that breaks a high or low in a given area of interest?
Here's the deal brother/(sister?) Bobbi... You can use your method you are describing. You could use something else. But, no matter what you are having success using, if you want the advice of the naysaysers, you've come to the right place: the internet. No matter what system you describe, there will always be plenty to assure you that it won't work. Ummm...I been seeing this happen here for, uh...a while. Still, the discussion is worthwhile, because any discussion always adds to a trader's possibilities, whether to add or eliminate any particular idea.
when fast is below the slow, good results only trading from the short side recommend 50dma over 200dma this is for short term scalping, a few minutes to a few hours most don't understand, I'm tired of explaining it
Thanks for the responses guys. I guess I am always seeking knowledge anytime I post on this site. I am still wondering how to go about using these moving averages, as either constant "averages or x duration" or changing them continually based on most recent duration (peak/trough). I'll state my point one more time, then go ahead and make some live calls tomorrow for my sake.... If short term price action doesn't drag longer term price action (MA) in it's direction, you go with trend/stay in the trade. However, if you don't get your with trend continuation in a timely fashion, longer term HAS TO get dragged down by shorter term and you get some type of reversal. BD
This is macd and simple MA crossovers do not work for the most of stocks over longer period of time. See below MACD scan results for different stocks MACD The main reason of failure of simple use of MAs is that market changes and we have periods of different volatility. If you start monitoring volatility and adjust your MACD or MAs setting to volatility then you may take something out of it. For comparison see Volatility adjusted MACD scan results below: V-MACD
So what's the modification? Are we expected to guess? Use telepathy? Joe Doaks (!) answered your question/problem/whatever. MA crossovers work great when price is trending, and being a form of momentum, they don't lag. Individual MAs lag, MA crossovers don't. The problem is chop. Lag or no lag, using MA crossovers in chop will get you sliced, diced and served up like raw hamburger. That's the fact, Jack.