| Finding stock buy and sell signals that are reasonably | | | | experienced traders use the 10 period and 30 period |
| accurate most of the time is not that hard if you | | | | simple moving averages to calculate when a solid |
| realize how to set up your indicators correctly. | | | | opportunity to enter and exit a stock presents itself. |
| Optimizing moving averages is a simple, yet fairly | | | | Another strategy is to work with the 8 moving |
| accurate way to locate the direction a stock is going, | | | | average and the 20 moving average which shows a |
| and when a change may occur. | | | | slight advance notice. The shorter the moving average, |
| The one thing that investors must be aware of when | | | | the faster the line moves. Simplified. this means that |
| using moving averages as a buy and sell indicator is | | | | the faster moving line is bullish when it is above the |
| the whipsaw effect. Basically this is the "noise" created | | | | slower moving line, and bearish when it is below it. To |
| by short term buying and selling. In other words, they | | | | go long on a trade, wait until the fast line drops down |
| may have small hills and valleys within a increasing or | | | | and crosses up through the slow line. In many cases, |
| decreasing line. If traders were to trade whenever this | | | | this is the signal to place a buy, as it is near the bottom |
| indicator gave you stock buy and sell signals, you | | | | of that period. Keep an eye on the fast line closely as |
| would have some enormous trading fees. | | | | it begins to turn and flatten out near the peak. As it |
| There are some simple steps to practice to make | | | | curves downward and crosses through the slow line, |
| sure that your moving average setup gives you proper | | | | this indicates your sell signal. |
| buy and sell signals without a lot of distraction. Most | | | | |