>200 SMA = uptrend, <200 SMA = downtrend
50 SMA/200 SMA - Golden Cross, Death Cross
8 EMA/21 EMA
Never buy long term on a stock below the 30MA
You can use either the Simple Moving Average or the Exponential Moving Average (most recent are weighted higher
Simple Moving Average - depending on timeframe, it will create a moving average that represents the most current candles
e.g. 1HR timeframe and 200MA
Last 200, 1HR Candles creates a connection point (aka line)
Exponential Moving Average - puts more emphasis on the most recent price action
Most often used for shorter timeframes to get a better picture of movement
Can be misleading during opening and closing
Keep it simple and look for opportunities to enter
Go long when price is trending above 200MA
Short when price is trending below 200MA
Simple Moving Average vs Exponential Moving Average vs Weighted Moving Average
Simple Moving Average - strongest as a long term indicator (50MA, 200MA)
Exponential Moving Average - strong as a short term indicator, but will be stronger with high timeframes (4H+)
Weighted Moving Average - stronger as a short term indicator than the SMA, and works better for intermediate or short term trades
Gives you the Average Weighted Price based on Volume
Break above or below signals strength or weakness
Above = more buyer who are willing to pay more
Below = people are not willing to spend more
Buy at line and hold until it crosses back under or create another stop
>50 = uptrend, <50 = downtrend
Use price action, divergence, resistance, support, and volume to guide your entry/exit points.
Overbought > 70, Oversold < 30
Note that stocks can trade for a long time in overbought and oversold conditions; be sure to understand price action, reversals, or support/resistance.
Using moving averages and the zero line to determine uptrends/downtrends
Use price action, divergence, resistance, support, and volume to guide your entry/exit points.
If you are using Moving Averages, typically when the 8MA crosses the 50MA is the equivalent of crossing the ZERO LINE.
One of the easiest methods when getting started
Uses Moving Averages to determine if a stock is trending
Buy above the cloud, sell below the cloud, and avoid inside of the cloud
Created by Ripster (One of the best and worth following on Twitter and Discord to learn how to use his system, sizing of your positions, entries/exits, and general trading)
***Note this is just one example. Watch other videos
This is an interesting way to help confirm whether you should be in a trade
This is a momentum indicator that works on the average price of each candle that is created
Follow the trend and take profit when the trend changes
Add other indicators to help entries and exits