BC TA

Moving Averages is a common indicator which most of us (novice/professional) use in the stock market for trading and investment.

This learning thread would be on
"๐™๐™จ๐™š๐™จ ๐™ค๐™› ๐™ˆ๐™ค๐™ซ๐™ž๐™ฃ๐™œ ๐˜ผ๐™ซ๐™š๐™ง๐™–๐™œ๐™š"

Like๐Ÿ‘ & Retweet๐Ÿ”„ for wider reach and more such learning thread.

1/10

Basics of the moving average:

It takes average of the price for the duration we want.

So 10 days moving average means an average price of 10 days closing price.

Common types of Moving Average:
Simple, Exponential, Weighted.

Use only one type in your trading setup.

2/10
Different uses:

1โƒฃ Moving Average Crossovers:

Common strategy used by positional traders and investor in finding multibagger or good returns stocks.

Common crossover used is for 50 & 200 Moving Average.

Also, this is called as "๐—š๐—ผ๐—น๐—ฑ๐—ฒ๐—ป ๐—–๐—ฟ๐—ผ๐˜€๐˜€๐—ผ๐˜ƒ๐—ฒ๐—ฟ"

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In this buy signal is initiated when lower MA (50 EMA) crosses above higher MA (200 EMA).
And exit or sell signal is intiated when lower MA (50 EMA) crosses below higher MA (200 EMA).

4/10
Let's see an example:
Pidilite Industries

Buying Price was 56 in 2009 and CMP is 2462 and still there is no selling signal.

44 times Multibagger or 4300% returns.

In lower time frame, it will give more whipsaw and more number of trades.

5/10
Setup looks easy, but is not that easy.

Sometimes stock stays in consolidation and it gives frequent buy and sell signal as seen in Airtel.

One way to avoid this noise is to use price action and look for the breakouts and then trade.

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2โƒฃ Support or Resistance

Moving averages can act as support or resistance to stocks.

Let's look at an example where it acted as a support.

In #IEX chart, 100 Days EMA acted as a support multiple times.
Also, a live trade was shared on IEX:
https://t.co/CXa5CM4pnP

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Let's look at an example where it acted as a Resistance.

Suzlon:

Stock faced resistance at 100 days EMA and it kept going down after EMA level.

Stock went down from 105 to 20 in two years.
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3โƒฃ Finally Moving Average can be used as a Stoplosses.

~ For a buyer, if price closes below a crucial moving average, then buy position is closed in stocks.

~ For a seller, if price closes above a crucial moving average, then short position is closed in stocks.

9/10
I hope everyone got a taste of how moving average can be used.

These are not a universal rules one must follow. One can create their rule or follow someone else rules.

Only important thing is one must follow a fix rule instead of tweaking or changing setup frequently.

10/10

More from Yash Mehta

In the early stage, most of the traders & investors use indicators in their analysis.

Here is a master thread of how most of the indicators can be used in trading/investing to increase accuracy for free๐Ÿงต:

Also, the last indicator and strategy is my favourite of all in trading.

1/ Moving Average is a very common indicator.

This thread is on what are the different ways of using the moving average


2/ RSI is one of the momentum indicator for traders.

In this thread, I have shared different ways of using RSI. Also, an investing strategy is shared, which can help you to pick stocks that can give you good


3/ CCI is another amazing indicator that is used by momentum traders.

Shared few strategies with CCI which a trader and investor both can


4/ CPR is one of the most popular indicator in the trading community.

This thread covers everything about the CPR indicator and how to use this indicator in

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A #story from #Thiruvilayadal puranam- one of divine leelas of Bhagwan Shiva

#threadseries #madurai

Koodal Kaandam

Story 21 - it is about how stone elephant came to life and ate sugarcane - When Raja Abhisheka Pandyan met Ellam Valla Siddhar

เฎ•เฎฒเฏเฎฏเฎพเฎฉเฏˆเฎ•เฏเฎ•เฏ เฎ•เฎฐเฏเฎฎเฏเฎชเฎฐเฏเฎคเฏเฎคเฎฟเฎฏ เฎชเฎŸเฎฒเฎฎเฏ


Raja Abhisheka Pandiyan went ahead to meet Ellam Valla Siddhar on the premises of the temple.On seeing the arrival of Raja, people surrounding Siddhar moved back. Abhisheka Pandiyan introduced himself to Siddhar &asked about his whereabouts.Also his purpose of visit to Madurai.

Raja asked why he performed magical acts, does he expect anything from him or people of Madurai.

Siddhar laughed & replied to Raja that he was from Kasi. He had heard a lot about Madurai in Kashi.Also told that this place is a Mukti Kshetram,so he had come to stay here.

Siddhar asked Raja if he has the capability &power to give anything that he asks for. Siddhar told King that he has power to do things even if he think of it.Siddhar asked King to ask whatever he wants & it would be provided, whatever these people had asked, they were granted.


Abhisheka Pandyan was shocked to receive such a reply from Siddhar,& he decided to test the power of this Siddhar. By that time, Raja saw a person in crowd having Sugarcane.

Raja took Sugarcane from that person.