![]() Sounds like the differences between a fast moving average (shorter period setting) and a slow moving average (longer period setting). More reliable signals, filtering out small trends.The effects of using a displaced moving average are: To highlight price crossovers, we displayed prices with a line chart instead of the usual candlestick charts.įrom this chart, it is clear that price always crosses the regular moving average before crossing the displaced moving average. (We adapted these settings from the DMA channel trading strategy.) Then, we added a 6-period simple moving average displaced by 4 periods to the right (blue). In this example, we placed a 6-period simple moving average (orange) on the daily chart of Southwest Airlines. Displacing Moving Average to the Right Comparing the Regular Moving Average with the Displaced Moving Average Is it an improvement over the normal moving average? However, what is the value of displacing the moving average right or left? Many trading strategies use displaced moving averages as an improvement over regular moving averages. ![]() If you shift the regular moving average on your chart to the right or left, you get a displaced moving average. ![]()
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