{"id":3250,"date":"2017-10-13T14:06:51","date_gmt":"2017-10-13T14:06:51","guid":{"rendered":"http:\/\/joapen.com\/blog\/?p=3250"},"modified":"2017-10-13T14:56:11","modified_gmt":"2017-10-13T14:56:11","slug":"simple-moving-average-basis","status":"publish","type":"post","link":"https:\/\/joapen.com\/blog\/2017\/10\/13\/simple-moving-average-basis\/","title":{"rendered":"Simple Moving Average, basis"},"content":{"rendered":"<p>I have read a couple of texts related to the simple moving average or rolling average, <a href=\"http:\/\/www.finanzas.com\/noticias\/mercados\/bolsas\/20140930\/sabes-como-utilizar-medias-2766363.html\">this one<\/a> explains the basis and the main values used. I have done some tests and I have compared them to understand the use better.<\/p>\n<h1>The different articles always have some tips about this analysis:<\/h1>\n<ul>\n<li>Do not operate based in these signals, use them as control checks.<\/li>\n<li>During lateral behavior of the market the signs can be false. They work better when there are major changes.<\/li>\n<\/ul>\n<p>The test below shows the Amazon trend plus rolling average trends with:<\/p>\n<ul>\n<li>short rolling = 10 days and long rolling 50 days<\/li>\n<li>short rolling = 20 days and long rolling 100 days<\/li>\n<li>short rolling = 5 days and long rolling 20 days<\/li>\n<\/ul>\n<h1><a href=\"http:\/\/joapen.com\/blog\/2017\/10\/13\/rolling-average-basis\/amzn-rolling-average\/\" rel=\"attachment wp-att-3252\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-3252\" src=\"http:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average.jpg\" alt=\"\" width=\"526\" height=\"535\" srcset=\"https:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average.jpg 526w, https:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average-295x300.jpg 295w\" sizes=\"auto, (max-width: 526px) 100vw, 526px\" \/><\/a>There is a concept where 3 lines are drawn, that is called the triple crossing, where:<\/h1>\n<ul>\n<li>Short rolling 4 days,<\/li>\n<li>Medium rolling 18 days<\/li>\n<li>Long rolling 40 days.<\/li>\n<\/ul>\n<p>This typically happens when a lateral behavior has finished and this is making a lot of investors to go with the flow.<\/p>\n<h1><a href=\"http:\/\/joapen.com\/blog\/2017\/10\/13\/rolling-average-basis\/amzn-rolling-average-4d-18d-40d\/\" rel=\"attachment wp-att-3256\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-3256\" src=\"http:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average-4d-18d-40d.jpg\" alt=\"\" width=\"1595\" height=\"775\" srcset=\"https:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average-4d-18d-40d.jpg 1595w, https:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average-4d-18d-40d-300x146.jpg 300w, https:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average-4d-18d-40d-768x373.jpg 768w, https:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average-4d-18d-40d-1024x498.jpg 1024w, https:\/\/joapen.com\/blog\/wp-content\/uploads\/2017\/10\/AMZN-rolling-average-4d-18d-40d-500x243.jpg 500w\" sizes=\"auto, (max-width: 1595px) 100vw, 1595px\" \/><\/a>For general understanding of which moving average you should use as guide:<\/h1>\n<ul>\n<li>5 days: For the hyper trader. This shorter the SMA the more signals you will receive when trading. The best way to use a 5-SMA is as a trade trigger in conjunction with a longer SMA period.<\/li>\n<li>10 days: popular with the short-term traders; great for swing traders and day traders.<\/li>\n<li>20 days: the last stop on the bus for short-term traders. Beyond 20-SMA you are basically looking at primary trends.<\/li>\n<li>50 days: used by traders to gauge mid-term trends.<\/li>\n<li>200 days: welcome to the world of long-term trend followers. Most investors will look for a cross above or below this average to represent if the stock is in a bullish or bearish trend.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>I have read a couple of texts related to the simple moving average or rolling average, this one explains the basis and the main values used. I have done some tests and I have compared them to understand the use better. The different articles always have some tips about this analysis: Do not operate based &#8230; <a title=\"Simple Moving Average, basis\" class=\"read-more\" href=\"https:\/\/joapen.com\/blog\/2017\/10\/13\/simple-moving-average-basis\/\" aria-label=\"Read more about Simple Moving Average, basis\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[105],"tags":[125,124],"class_list":["post-3250","post","type-post","status-publish","format-standard","hentry","category-trading","tag-simple-moving-average","tag-trading"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Simple Moving Average, basis -<\/title>\n<meta name=\"description\" content=\"I have read a couple of texts related to the simple moving average or rolling average, this one explains the basis and the main values used. 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