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  1. #1
    Amfoxova Guest

    Default Simple moving average - too simple?

    Still relatively new to spread betting the indices, so please bear with me, I've seen a simple moving average example and wanted to run it past you guys.

    MA with it set at 10, 30 and remove the 3rd line.

    Been watching the FTSE for a few sessions and everytime the 10MA crosses above the 30 line, the SP rises. Everytime it dips below the 30MA line, the price drops.

    Told you it was simple, maybe too simple. Please remember I'm starting from scratch (almost)

    Any feedback/advice/observations or criticisms

  2. #2
    AndrewsolTreby Guest


    You have it reversed. When the index rises or falls, the MA follows suit. The MA can't move first due to what it is.

  3. #3
    AnatolEn Guest


    Try using a Bollinger band with 20-period MA and 2 standard deviation band. The bands give you a sense of the significance of any price move above/below the moving average (relative to recent volatility). When the price touches the lower/upper band, it can be interpreted as a buy/sell signal. I do something similar, except a bit more sophisticated -- a Kalman filter applied to a cointegrated portfolio.

  4. #4
    Andrewclege Guest


    Apologies dbphoenix, I knew what I meant to say, just it came out wrong

  5. #5
    AngeloGoart Guest


    No need to apologize. Just remember that the faster MA crosses the slower because price has risen or at minimum altered its downward trajectory. Ditto the reverse. Thus the crossover alone will either be a false signal or a late signal. Better to evaluate the price movement without aids.



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