![]() Consequently, you will often find them being referred to only as 50-day, 100-day and/or 200-day moving averages. Finally, a key aspect to keep in mind is that the 50, 100 and 200-period moving averages are most commonly used on the daily chart and therefore tend to be a more reliable trading signal on this timeframe.Here, like in many other areas of trading the markets, it all comes down to preferences and to what works best with your strategies. However, again, the 50-period moving average appears to be the more popular option among traders, although that doesn’t mean that it’s going to be the better option for everyone. Further, some traders prefer the 55-period moving average instead of the 50-period, mainly because the number 55 is part of the Fibonacci sequence.Of course, some traders like to use the weighted (WMA) or the exponential moving averages (EMA), but most of the time and most traders use the simple 50, 100 and 200-period moving averages on their charts. Generally, though, the most popular calculation for the 50, 100 and 200 period moving averages is the simple moving average (SMA). So, first of all, there are some different variations of these 3 moving averages that are commonly used.This is as important as knowing how to trade them and what the trading signals mean. Instead, in this post, we’ll only discuss the group of what are probably the 3 most important moving averages that a trader will ever need.īefore we get into the details on how to use the 50, 100 and 200-period moving averages, let’s start with some preliminaries regarding the contexts in which they are used. You can read more about that in the general article on moving averages here. Since a lot of traders are plotting the group of the 50, 100 and 200 moving averages on their charts, it only makes them a more reliable trading indicator.īut, we are not going to go into what are moving averages, how they are calculated or any basics of that kind in this article. Basically, the more people look at and trade by the same price level the more likely it is for that price to be important in some way (i.e. More importantly, it’s even more common among professional and successful traders.Ĭonsidering that one of the basic rules of technical analysis is essentially a self-fulfilling prophecy, it’s no wonder that these 3 moving averages work so well in the Forex market. People use all kinds of moving averages on their charts, but the group of these 3 is particularly common in the trading world. Now, you may be wondering why we are focusing on those moving averages specifically and why they are so important. You have probably noticed that we frequently talk about the 50, 100 and 200 period moving averages in our daily and weekly posts that are regularly published in the FxTradingRevolution news section. Trading The real importance of the 50, 100 and 200 period moving averages in profitable FX trading 17:36
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |