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Stock Analyzer

03/04/07 9:49 PM

#8638 RE: Stock Analyzer #8637

Lesson #2 the alignment of the Moving averages:

The ideal chart would have the price on the very top of all moving average lines. Right under the price would be the 20 MA line, then the 50 below the 20 then 100 below 50 and the 200 below the 100. This shows the stock is in a nice uptrend and is being supported by all its MA "trend" lines. This is a stock with good "support"

EXAMPLE: TNOG CHART (2 parts)

You can see by looking at these two charts that the sequence is 20, 50, 100, and 200 MA lined up frop below the price



part 2



A flip of this with all MA lines on TOP starting with the 200 on the very top, 100 underneath, 50 under then 20 right above the price is a stock with heavy "resistance" This is not the ideal chart for a stock to buy in.

Sometimes a stock trades inbetween its MA, using its 20 as support and its 50 as resistance. This is fine, just play the channel, buy the low and sell the high or thereabouts. Same thing if it were between 50 and 200, just play what you see and be happy. MA lines are good indicators of where a stock will bounce off of and go up or hit and come down. Remember, there is not ALWAYS in trading, so "always" trade with caution.