Trading Short Term and LongTerm Price Period of Moving Average
A trader can select to adjust the Indices price periods used to calculate the moving average.
How Do I Trade with Moving Average?
If a trader uses short price periods then the MA will react faster to the changes in price.
For example if a trader uses the 7 day Stock Index moving average then, moving average indicator will react to the Indices price change much faster than a 14 day or 21 day Stock Index MA Moving Average would. However, using short time Indices price periods to calculate the MA may result in the indicator giving false signals (whipsaws).
7 Day MA Moving Average - MA Moving Average Indices Strategies
If another trader uses longer time periods then the MA will react to price changes much slower.
For example, if a trader uses the 14 day MA then the average will be less prone to whipsaws but it'll react much slower.
14 Day MA Moving Average - MA Moving Average Indices Strategy Example
21 Day MA Moving Average - MA Moving Average Indices Trade Strategies Example
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