Market observations and actions

[themickey]

Market Observer:

themickey could be a little more kind!

However, I think his point may be that your conclusion, although it could be right, might be based on "evidence" that, in itself, isn't enough to draw that conclusion. Does that make sense?

MA's are non anchored indicators, offering largely vague TA information, just inaccurate.
An average price over the last 'x' days is nonsense because it depends on trend slope and volatility to accurately give a figure.

However in this day and age technicians continue to be wedded to the largely uselessness of MA's and continue the myth of how these indicators lead to accurate prognosis & decisions.

A slightly better way would be to make the statement, "More than 50% of stocks in the index are above the MA" (choose your own subjective MA period).

 

[themickey]

The thing about trading, if you bs to yourself, you will get bs results.
TA in reality largely is like a voodoo doctor scattering chicken bones on the ground or reading tea leaves to determine a result from the pattern.

Using MA's, which one shall we use?
Scattering chicken bones, which ones are the most significant bones?

Scientifically proven MA's provide no edge, but like ivermectin, we don't want proof of a dud to get in the way of a good yarn.

 

[KCalhoun]

But, the S&P pivoted off the 50SMA almost every time this past year, so occasionally it's helpful. Usually though, squiggly lines are not.

 

[deaddog]

The thing about trading, if you bs to yourself, you will get bs results.
TA in reality largely is like a voodoo doctor scattering chicken bones on the ground or reading tea leaves to determine a result from the pattern.

TA show you what happened in the past. I'm not sure about chicken bones. It's up to the trader to figure out the probabilities of the history repeating itself. If something has happened regularly in the past it might be worth a bet that it will happen again. The trader determines if the risk is worth the reward.

 

[themickey]

TA show you what happened in the past. I'm not sure about chicken bones. It's up to the trader to figure out the probabilities of the history repeating itself. If something has happened regularly in the past it might be worth a bet that it will happen again. The trader determines if the risk is worth the reward.

Yeah right, taking your words and in the context of 21MA & 50MA, past 5 years, failed 2018, 2019 and 2020.
But never mind picking dates here and there, any argument needs to include logic and the revolving argument of MA's will go on to the end of eternity.

 

[themickey]

But, the S&P pivoted off the 50SMA almost every time this past year, so occasionally it's helpful. Usually though, squiggly lines are not.

We're not talking atm about bouncing off 50MA.

 

[themickey]

Imagine, if I wrote a book about " Stupid moving averages".
(I doubt anyone has written such a book.)
It could be a best seller, or like politics, are people's minds welded to their guru and they still wouldn't wakeup?

 

[deaddog]

Imagine, if I wrote a book about " Stupid moving averages".
(I doubt anyone has written such a book.)
It could be a best seller, or like politics, are people's minds welded to their guru and they still wouldn't wakeup?

Ahh Mic; you're being too hard on moving averages.
Lines on a chart that have no value. Don't like them; don't put them on your chart.
I like them, it saves me drawing trend lines. A quick look tell me what I think I need to know.
I want to find a stock that moves up smoothly; I scan for stacked MAs.
I want to see how the market is doing; I scan for the number of stock in an index trading below a MA.
Tools in a tool box. Just gotta figure out the right tool for the job.

 

[formikatrading]

So true. Folks want to debate whether TA works or not. MAs, indicators, etc. -- they are just tools. The skill is picking the right tools at the right time and realizing that the tools aren't perfect.

Tools in a tool box. Just gotta figure out the right tool for the job.

 

[themickey]

So true. Folks want to debate whether TA works or not. MAs, indicators, etc. -- they are just tools. The skill is picking the right tools at the right time and realizing that the tools aren't perfect.

We know all that basic stuff.
21MA & 50MA as a bullish indicator tool, best of luck.