which moving avgs do most traders use?

Discussion in 'Technical Analysis' started by cashclay, Apr 28, 2018.

  1. SunTrader

    SunTrader

    Most traders ... don't use moving averages. Most wanna be traders do.
     
    #11     Apr 29, 2018
    lawrence-lugar and Xela like this.
  2. Arnie

    Arnie

  3. qxr1011

    qxr1011

    why do you care what other people use?

    maybe they all morons?! (99.99 % failing in trading anyway)

    or may be geniuses :) ? (in which case they would tell you nothing)

    why do you want to use moving average?

    do you know how you want to use it, did you try it, did you work with it, did you research it ?

    the answer is probably no , because if the answer would be yes you would figure out which MA to use (or not to use at all), with which period, and etc etc,, and you would not need to ask stupid public stupid questions
     
    Last edited: Apr 29, 2018
    #13     Apr 29, 2018
    Xela likes this.
  4. If you're a swing player, MAs have some worth, but I wouldn't try to make a system out of their use. The ones most players watch are the 50 & 200. If "everybody is watching them", so should you. Sometimes MAs mean very little/ nothing....as in the chart posted by expiated.
     
    #14     Apr 29, 2018
  5. Moving averages are just noise to the knowledgeable trader.
     
    #15     Apr 29, 2018
  6. fan27

    fan27

    I find some EOD strategies perform better when price is above the 200 ma. Others perform better when price is below it.
     
    #16     Apr 29, 2018
    murray t turtle likes this.
  7. I'll echo a lot of the comments already made above.

    Many years ago, when I was first getting into trading, I did a lot of testing using moving averages, including moving average crossover systems. I discovered a few interesting things along the way that propelled me to learn more about the markets, but I didn't find any statistically significant patterns when using moving average crossover signals on equities. I distinctly remember being tremendously (over-) excited one day when I thought I had found a great edge, but fortunately I had enough sense to go learn enough statistics to properly test that hypothesis before putting money on it. I saved myself from losing money and gained knowledge in a then-new-to-me field to boot.

    Fast forward fifteen years and I now have three models with high statistically significant and tradeable edges. (Personally, I define having an "edge" as having a positive expected value of profits and losses; ie E(PL)>0, PL=all profits and losses due to this strategy. I go beyond basic statistics to verify that E(X) is truly statistically significantly positive, including various checks of robustness, using both parametric and non-parametric statistics, etc.) One of these models involves the 200 day SMA, but the moving average is used as a filter, not as a trading signal. This model could be viewed as the combination of two (related) models: when the price is above the 200 day SMA, I use model M1 and when it is below the 200 day SMA I use model M2. The reason for choosing the moving average is, in fact, rooted in the rationale for the formulation of M1 and M2 in the first place. It's not arbitrary.

    I'll end here. I'm being called for dinner..... lol
     
    #17     Apr 29, 2018
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  8. Overnight

    Overnight

    How has that model been working for you in your live trading?
     
    #18     Apr 29, 2018
    murray t turtle likes this.
  9. Peter8519

    Peter8519

    Anyone trying look at SMA from the market perspective? At a single stock, it may not mean much. Just take any SMA, e.g. SMA 50. When a stock is above it, start counting the number of days it's about it. Let's say, you track for a period of one year. Do a frequency plot in terms of number of days above SMA. Do for a couple of years and see the frequency plot.
     
    #19     Apr 29, 2018
  10. I second Overnights question! And definately tell us more about M1 and M2! When you dont have food in your mouth. :)
     
    #20     Apr 30, 2018