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Moving Average
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A
friend of mine trades the 18 day moving average quite successfully.
A lot of people have asked me what that means and I will try
to explain it.
So,
due to popular demand, I am including a brief explanation of
the very simple theory of trading the 18 day moving average.
The two lines on the following chart are the 18 day and the 14
day moving average. You will find these on almost any commodities
chart that you use. In this example, the 14 day and the 18 day
moving average are for practical purposes almost the same...
so you can use either one.
Looking
at the following graph, you will notice that in September the
Yen rises above the 'moving averages' giving us a buy signal.
Then in February, the Yen moves below the moving averages giving
us a sell signal. Then again in August, the Yen rises above the
moving averages giving us another buy signal. The first of January
the Yen moves abruptly below the moving averages again giving
us a sell signal.
However,
from January until October, the Yen is in a channel which does
not tend to go up or down... only sideways. Then in October 2000,
the Yen makes a breakout below the moving averages giving us
a sell signal.
You
can see for yourself that between January and October 2000 is
a difficult time to trade the yen since there is no clear indication
of direction. However, if you keep a careful eye on the market,
and use very tight micro-management of your funds, you should
still be able to find a discernible micro move in the Yen and
hopefully make it pay for you.
Back to Fapturbo Robot should
still be able to find a \ Back to Megadroid
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