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Ma & Macd

Moving averages are a fundamental technical analysis tool used to gauge the average price of a security over a specified time period, guiding investors on when to buy or sell based on price movements relative to the average. The Moving Average Convergence Divergence (MACD) indicator is derived from the difference between a 12-day and a 26-day moving average, signaling bullish or bearish trends based on its position relative to zero. While moving averages help investors stay aligned with market trends, they can lead to late trades if trends are short-lived.

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Ngân Kim
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69 views6 pages

Ma & Macd

Moving averages are a fundamental technical analysis tool used to gauge the average price of a security over a specified time period, guiding investors on when to buy or sell based on price movements relative to the average. The Moving Average Convergence Divergence (MACD) indicator is derived from the difference between a 12-day and a 26-day moving average, signaling bullish or bearish trends based on its position relative to zero. While moving averages help investors stay aligned with market trends, they can lead to late trades if trends are short-lived.

Uploaded by

Ngân Kim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Technical Analysis

MOVING AVERAGE
MA
• Moving averages are one of the oldest and most popular technical
analysis tools
• A moving average is the average price of a security at a given time.
When calculating a moving average, you specify the time span to
calculate the average price (e.g., 25 days).
• Investors typically buy when a security's price rises above its moving
average and sell when the price falls below its moving average
MA

If the security's price is above its


moving average, it means that
investor's current expectations
(i.e., the current price) are
higher than their average
expectations over the last 25
days, and that investors are
becoming increasingly bullish on
the security
Merits
• The merit of this type of
moving average system (i.e.,
buying and selling when
prices penetrate their moving
average) is that you will
always be on the "right" side
of the market--prices cannot
rise very much without the
price rising above its average
price. The disadvantage is
that you will always buy and
sell late. If the trend doesn't
last for a significant period of
time, typically twice the
length of the moving average,
you'll lose money.
MACD - Moving Average
Convergence Divergence
• The MACD is calculated by subtracting a 26-day moving average of a
security's price from a 12-day moving average of its price. The result is
an indicator that oscillates above and below zero.
• When the MACD is above zero, it means the 12-day moving average is
higher than the 26-day moving average. This implies a bullish, or
upward, shift in the supply/demand lines.
• When the MACD falls below zero, it means that the 12-day moving
average is less than the 26-day moving average, implying a bearish
shift in the supply/demand lines
MACD

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