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Day Trading/Moving Averages

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Question
Hello:

What is a good second and third day moving average to use with a 200 day moving average?

I thank you for your reply.

Answer
Hi Kenneth,

Since the 200 day moving average is an average used to gauge longer moves and trends, the 50 period average is the most popular compliment. Many institutional traders and funds use these 2 moving averages to get a general feel for the long term trend...50 above 200 = uptrend, 50 below 200 = downtrend.

A third moving average would really be dependent on your goals and style of trading but you might consider a 10, 18, or 20 to add to the 50 and 200 moving averages to have a "fast" moving average reference.  

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Mark Hodge

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Questions related to technical analysis, strategies, risk, trading plans, trading psychology and money management. Experience in trading all markets and time-frames with expertise in futures (e-minis, currencies, commodities) and equity options. Unfortunately I am not allowed to offer any specific trading advice (i.e. should I go long the E-mini S&P today).

Experience

I have been involved in the industry since 1995 working for Morgan Stanley Dean Witter and American Express Financial Advisors before becoming a full time trader. As Head Education Coach with Rockwell Trading I have coached hundreds of students around the world to achieve their trading goals with simple strategies, a sound trading plan and proper money management for the leveraged markets.

Organizations
Currently serving as Rockwell Trading's Head Education Coach www.rockwelltrading.com and moderator for Rockwell's Student Trading Room where we follow opportunities in the minis, interest rates, currency and grain markets daily.

Publications
Technical Analysis of Stocks & Commodities, "Day Trading With Volatility", June 2010 SFO Magazine, "Home on the Range: Lasso Trades Without Time", August 2010 SFO Magazine, "Day Trading Indicators, Part 1", January 2011 SFO Magazine, "Day Trading Indicators, Part 2", February 2011 SFO Magazine, "Technical Strategy", April 2011 SFO Magazine, "Advanced Trading Techniques - Futures Spread Trading", October 2011 Active Trader, "A Simple Day-Trading Strategy", November 2011 Marketplace Books, How to Trade Commodities: Simple Strategies for Gold and Crude That Traders Can Use in Any Market, June 2011

Education/Credentials
Formerly licensed as a financial advisor with Series 6, 7, and 63 licenses. B.A. in Organizational Communications with a Business Minor from California State University, Sacramento.

Past/Present Clients
I have worked with institutional traders, brokers, proprietary trading firms and private traders.
One of the few distinguished World Cup Advisors www.worldcupadvisors.com

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