Classic use of moving average Granvile Law Money Tips

Category: Money tips Release Date: 2006-01-31

Moving average is a technical analyst at a technology most commonly used indicator. Because it is simple, practical, flexible and the fact that any set of today's software is included in the technical specifications. If investors are able to skillfully use a moving average line, then it is very likely to profit in the market, moving average line Why is it so amazing? Because it corresponds to the two successful marketing motto, "the flow" and of "let your profits increase substantially, so that you minimize the loss", it never predicted that respond only to the facts.

There are currently three types of moving average line:

1, a simple moving average line;
2, linear weighted moving average line;
3, exponential smoothing moving average.

Simple moving average line is the moving average number of days of price data of the arithmetic mean, it is widely used, has also been proven to be a reference value of the moving average line. The following discussion of the specific methods I use a simple moving average, for example, of course, they also apply to other two types of moving averages.

The use of moving average, the most classic is the Granvile law, its contents are:

1, the average line from the beginning to go flat down, rates are going up across the average to generate buy signals;
2, the price rise in a row, away from the average line, a sudden drop in when you get close to the average line support, generate buy signals;
3, the price plummeted straight substantially away from the average to generate buy signals;
4, the average increase in line from the beginning to go flat, the price downward through the average, resulting in sell signal;
5, the price falling, away from the average line, a sudden rise in the average time to be suppressed close to generate sell signals;
6, the price soared straight substantially away from the average to generate sell signals.

In actual application, the trader can be used for opening the granary 1,2,4,5 4, while the 3,6 for the two open positions, as far from the average prices resulting from market, the trend does not mean that the anti - turn, is just a rebound.