How can a Moving Average becomes a rainbow?
Never underestimate the power of Moving Averages
A lot of New Entrants in the market believes that the more complicated the indicators they use, the better.
That is a TOTAL LIE.
Simply looking at how the moving average forms a rainbow color, it will give you a Pot of Gold at the end, only if you knew how each one behaves.
According to Marty Schwartz
“I always check my charts and the moving averages prior to taking a position. Is the price above or below the moving average? That works better than any tool I have. I try not to go against the moving averages; it is self-destructive.”-
A very known trader, does not look down as to how powerful moving average is.
What is moving average?
According to investopedia,
A moving average (MA) is a widely used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random short-term price fluctuations. It is a trend-following, or lagging, indicator because it is based on past prices.
Each moving average number has its own purpose.
And when you found it’s purpose and executes it, you will surely found a pot of gold as well.
Let’s start hunting for the line that will soon become a rainbow…