MA Support and Resistance Levels

MAs can be used as points of support & resistance on charts.

When trading price reaches the moving average, the Moving Average level can act as a point of support or resistance for the trading price.

Buy Trading Signal

If trading price is on an upward trend and starts to retrace, then most traders might wait to buy at a better trading price when the trading price hits a support level. Traders will sometimes use the Moving Average to determine the support level.

A buy signal is generated when trading price hits the Moving Average, turns and starts moving in the upward trend direction. The signal is confirmed when trading price closes above the MA. Because many traders use the moving averages to generate trading signals, trading price will normally react to these levels.

A stoploss should be set just below the Moving Average indices trading Indicator. Ideally it should be set a few pips below the previous low.

How to Trade Indices with Moving Average Strategy Method

Sell Trading Signal

If the trading price is on a downward trend and starts to retrace, then most traders might wait to sell at a better trading price when the trading price hits a resistance level. Traders will sometimes use the Moving Average to determine the resistance level.

A sell signal is generated when trading price hits the Moving Average, turns and starts moving in the downward trend direction. The signal is confirmed when trading price closes below the MA. Because many traders use the moving averages to generate trading signals, trading price will normally react to these levels.

A stoploss should be set just above the indices moving average indicator. Ideally it should be set a few pips above the previous high.

Sell Indices Trading Signal - How to Trade Indices with Moving Average Strategy Method

Resistance Level turns Support Level

In Indices Trading - When a resistance level is broken it turns into support & vice versa.

This happens when the fundamentals of a trend change and consequently the direction of indices. Direction change is reflected by the moving average technical indicator, the direction is confirmed when resistance zone turns into support area or vice versa (when support level turns into resistance level)

Resistance Level turns Support Level - Moving Average Indices Trading Strategy Examples