MAs are a crutch, and not much help in any time frame. All you need to trade successfully is (1) A measure of volatility (2) Open, Close, High, Low of your instrument compared to x number of previous bars (3) An exit. (Profit target, Loss target, Bars or time) That's what price action is, and that's all you need. Here's an example of a short entry on an instrument I trade, which is one of the most profitable in my toolbox. ENTRY AT OPEN OF BAR IF: CL.1>OP.2*1.10 OR CL.1>LO.1*1.08 OR CL.1>CL.2*1.08 OR CL.1>OP.2*1.10 OR (CL.1>OP.1 AND CL.1<HI.1*.97) OR (CL.1>OP.1 AND HI.1>OP.1*1.05) EXIT: AT CLOSE OF BAR There is not an MA or indicator in sight. All price action
Not our fault, you've obviously had a really big loss and your losing the plot, stop posting, stop trading and calm the fuck down.
An MA is a very effective tool at defining the trend direction in that particular time period. The state of a trend in another time period is described using a suitably longer or shorter MA. MA's do not give effective entry signals. They do not indicate that a reversal will occur within the next bar. They do not confirm whether a pull-back will become a trend failure.
%% True; counter trends simply dont las as long.Back to my 50 day moving average...……………………………………………………………………………………………………………………...
Why, because you still haven't found a way to profit from it? Used wisely, I can assure that moving averages can greatly enhance the trading results of any trading system. And, at the very least, they can prevent the trader from betting against the trend.
Please allow me to rephrase your post: "Me, Lindq, have not found a way to profit from moving averages, yet".
That's a nice hat, but it doesn't hide the fact that new traders have probably wasted more valuable time chasing MAs up, down, and sideways, than any other activity. Better for them to simply ask: Where is price now in relation to where it has been, and what does that tell me? Nearly every indicator looks at that simple, basic question, and tries to embellish it to the point of obfuscation.
If you are going to use MAs, one should learn to view them as lowpass digital filters so that you can better engineer them to meet your needs, which typically means less lag and better attenuation of the "noise." John Ehlers is the man to study for digital filtering in finance. None of the more advanced math will mean that you will make money of course. A lot depends on how you use them in the context of a trading system.