MA Whipsaws in Range Markets Strategies
Range Markets Strategies
The indices trading moving average is a useful chart indicator to trade with when a indices trend has formed. However the moving average indicator is prone to fake outs when price is trading in rangebound market.
The MA Moving Average is prone to whipsaw fakeouts during a ranging market because the price is volatile and keeps moving around the average, causing the trading moving average indicator to give signals indicating upward indices trend & then quickly changing to give sell stock signals.
It's for this reason that the Moving Average indicator shouldn't be used to trade indices in a range based market.
Range-Bound Market and Whipsaws - How to Trade Stock Index in a Range Market
This is why it's best to combine this trading moving average indicator with other indicators when generating signals to trade indices with.
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