Although the moving average has a certain lag in application and can help rise and fall, these cannot hide the huge role of the moving average in tracking trends. Today we introduce 6 classic applications of moving average.
1. Multi head arrangement and short head arrangement
The characteristics of the multi head arrangement: 1. It appears in the rising trend; 2. It is composed of three average moving averages. The top one is the short-term average, the middle one is the medium-term average, and the bottom one is the long-term average; 3. The three moving averages radiate upward in an arc shape.
The characteristics and operation strategies of short positions are opposite to those of long positions, and diverge downward in a circular arc.
Death crossover is the opposite of gold crossover.
The later triangle area is Golden Valley, which can be used as a reference buying point for stable investors.
The Death Valley is a triangle with a downward tip. The death valley appearing in the later period of the rise is a typical reference selling point.
Downhill landslide shape refers to the short-term and medium-term moving average moving downward along a certain slope under the pressure of long-term moving average, which is a typical downward trend graph.
5. Wave by wave rising and wave by wave falling
The wave by wave rising shape is similar to the rising climbing shape. Both short-term and medium-term moving averages move upward along a certain slope under the support of long-term moving averages. The difference is that the short-term and medium-term moving averages of wave by wave rising shape form a wave winding trend of gradually rising low and high points above the long-term moving averages. It is a typical upward trend graph.
The wave falling shape is similar to the downhill landslide shape. Both the short-term and medium-term moving averages move downward along a certain slope under the pressure of the long-term moving averages. The difference is that the short-term and medium-term moving averages of the wave falling shape form a wave coiling trend of low points and high points gradually decreasing below the long-term moving averages, which is a typical downward trend graph.
6. Dragon Going out to Sea and Broken Head Chopper Blade
Jiaolong Sailing refers to the fact that the mid sun line or the big sun line crosses multiple moving averages from bottom to top. If the trading volume is amplified, it is a typical reference buying signal.
Broken end guillotine refers to that the middle or large negative line breaks through multiple moving averages from top to bottom. When breaking through multiple moving averages, there is no need to amplify the trading volume. It is a typical reference selling signal.
