Technical Analysis of Moving Average Indicator

Stock Indices Trend Identification

The Stock Indices moving average indicator can be used as an indicator for generating Stock Indices trading signals. A buy or sell Stock Indices signal is generated when price either moves above or below the moving average, respectively.

If the MA is heading upward in diagonal manner then the general Stock Indices market trend is upwards.

If the on the other hand the MA is heading downwards in diagonal manner then the general Stock Indices market trend is downwards.

Upward Stock Indices Trend/Bullish Trend

If the MA is moving up, then the Stock Indices trend is upwards and the signal generated is a buy/bullish Stock Indices trading signal.

As long as the Stock Indices price is above the moving average then the Stock Indices trend will remain as an upward trend. The moving average will act as a "support level" and price action of the Stock Indices chart candlesticks should not close below the MA.

Buy Signal

When the Stock Indices price moves above the MA and closes above the moving average, a buy Stock Indices trading signal is generated.

Stock Indices Traders, who want to confirm the Stock Indices trade signal before implementing it, should wait until the MA line turns and starts to move in an upward Stock Indices trend direction. It is always best to wait for the confirmation Stock Indices trading signal so as to reduce chances of a whipsaw.

Upward Stock Indices Trend - How Do I Day Trade Indices: A Detailed Guide to Day Trading Strategies

Downward Stock Indices Trend/Bearish Market

If the MA is moving down, then the Stock Indices trend is downwards and the signal generated is a sell/short Stock Indices trading signal.

As long as the Stock Indices price is below the MA then the Stock Indices trend will remain as a downward bearish Stock Indices trend. The MA will act as a "resistance level" and price action of candlesticks should not close above the MA.

Sell Signal

When the Stock Indices price moves below the MA and closes below the moving average, a sell Stock Indices trading signal is generated.

Stock Indices traders who want to confirm the Stock Indices signal should wait until the MA line turns and starts to move in a downward direction. This will reduce the chance of trading a whipsaw.

Downward Stock Indices Trend - How Do I Day Trade Indices: A Detailed Guide to Day Trading Strategies

Stock Indices Range Market signals

Range Stock Indices Market signals can also be identified using the Moving Average Indicator.

Moving Average Crossover Method Stock Indices Trading Strategy

The moving average crossover method is also another Stock Indices trading signal generation strategy that is more favored by traders compared to the above Stock Indices trading signal generation strategy method. Moving average crossover Stock Indices trading strategy is also the simplest form of a Stock Indices trading system widely used by online Stock Indices traders. This MA crossover method is combined with other technical indicators to form more complex Stock Indices trading systems and Stock Indices trading strategies.