What are the best combination of moving averages for intraday trading? I watched a video recently about Fibonacci related moving averages but didn’t quite understand it. Any help?
when i was a newcomer in trading it was my foremost trading strategy but it not worked as like demo when starting a live account.
Do you have to trade intra-day? I mean, you seem new to trading - is there a business case that says you will succeed if you trade intra-day but fail if you trade long-term?
Thank you Tommor for your reply. Hmm, I love this idea. Actually my mentor always made it seem like long term traders are so far fetched and intraday is the ideal way to go. But really who say that? What does it take to be a long term trader? What timeframes and what strategies? I’ll love to give this a try.
Thanks Neil for the input. Really? What strategy worked for you finally?
Use the daily chart and follow price when it has become a trend. Set a wide stop-loss and small position sizes.
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What do you understand by
Period : 24
MA method : simple
Apply to : close
on a 1hour chart .
Do you mind explaining to me?
Your mentor is rubbish. Stop talking to him. No moving average combination will make you money so stop looking for a crossover strategy. Dont waste your time or money.
Well a moving average in general calculates the average closing prices of an asset for x number of period. In this case x = 24. Also remember that the value of x depends on your timeframe. So if you’re trading 1hr charts a 24 period moving average would mean average closing price of your asset for the previous 24 candlesticks or bars which equates to the previous 24 hours. If you’re trading a one minute chart then the previous 24 minutes. The charting software calculates it and plots it for you as a line which you see on your chart following the prices. Apply to close as I’ve said earlier means it calculates using the previous closing prices. The color represent the color of the line. I hope that helps.
lol. Okay😳
So 12 candlesticks would represent half a day. Since there is 24hr per day, thus for INTRADAY trading, we can use can 24MA and 12MA? If each hourly candle close below both Moving averages means selling pressure intact and vice versa. If hourly candle close between MA24 and MA12 means ranging conditions.
MA16 would represent 2/3 of a day.
MA8 would represent 1/3 of a day.
Maybe a combination of MA16 and MA8 on a hourly chart would be nice to use for INTRADAY trading?
MACD may also be complimentary for intraday trading as it depicts the net change between 2 MA and illustrates it in histogram form.
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Your logic is reasonable here and your conclusion is representative of many intraday methods based on MAs. I have seen many where the shorter MA is 5-10 periods combined with a longer MA of 10-20 periods (e.g. the HLHB system on this site).
The choice of MA type is also mainly EMA rather than SMA on these short term methods for the same reason - they react quicker.
BUT… the same benefit (i.e. quick reaction time) that make these attractive is also the reason for their frequent downfall - whipsawing in tight ranging, or drifting, markets.
And we do not know until after the event whether each MA signal is the start of something big or just another short term flip. Afterall, when comparing a short term MA with a longer term MA one is always on one side of the other!
This is why, although MAs can be good indicators for entries, they usually need some additional technique to provide confluence in an attempt to avoid fakeys. E.g. the use RSI and ADX in that HLHB method (just as an example).
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