If we look at a market moving on a daily, weekly or monthly basis, the monthly moving average is definitely preferable, as it is usually best for moving averages to be above the monthly moving average.
What are the best historical moving averages for traders?
In general, the lower the moving average, the more the market moves in that direction. For example, in the case of a 10-day moving average (MMA) the price moves much faster than the 10-day exponential moving average.
On a weekly or monthly basis the price is usually not moving very strongly (because most times a week or month the price is below the previous day’s price, which means the previous MMA was higher than the current one). So when the price is up, it is best to use the moving average since it makes the market move up slower. When it is down, use the exponential moving average since it makes the market move down faster.
What is the difference between daily and weekly moving average charts?
The price may move in a daily or weekly chart since day 0 but the market will move much faster than that since the last day’s price is the first one.
If a daily moving average chart is used, it is necessary that the chart is positioned on a positive price, because you cannot rely on a positive price to show you where the moving average is on the day. So it is better to hold the chart for at least 3 or 4 days or even longer if you want to identify the moves in the market that show up in the weekly or monthly charts.
Where does the difference between daily and weekly trending charts come from?
If the price moves from the day 0 up to the day 5 or 6, the day 6 trend should be used as a weekly trend indicator.
If the price moves from the day 5 up to the day 6 or the day 3 up to the day 5, the day 2 price should be used as a weekly trend indicator.
If the price stays above the day 2 high, the day 5 price should be used as a daily trend indicator. If the price stays above the day 5 high or below the price of the day 5 high, the day 2 price should be used as a weekly trend indicator.
Is this the best market chart for you?
This is what market charting is all about.
We want to build up your knowledge and experience, and also make trading fun and easy by giving you
best day trading courses reddit, tradestocks com review, intermediate trading strategies, simple swing trading scanner and strategy, bullish swing setup