Sunday, November 29, 2009

MOVING AVERAGES

hi friends
as u know . when U observe on a stock price on mkt depth window u may not judge even where it is heading . to resolve this issue u may concider moving average . it is nothing more than the average of privious prices . it is legging indicator and u can choose the period at your own .you may have heard abt 200DMA, 50DMA ,they are nothing but simple average of 200 days closing prices AND 50 days closing prices .
these moving averages are of different type
simple moving average
exponential moving average
weighted moving average
so the fluctuated price can be shown in a linear manner . to check the trend for day trade u can place 14 & 42 mins moving average to confirm trend revarsal on a intraday minute chart . for more info on the subject u may go to wikipaedia the treders encyclopaedia,there u will get answer for your all querries

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