Comments on: Link: Thoughts on Moving Averages http://blog.afraidtotrade.com/link-thoughts-on-moving-averages/ Helping traders overcome fears and emotions in trading Thu, 09 Feb 2012 14:53:15 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Corey http://blog.afraidtotrade.com/link-thoughts-on-moving-averages/comment-page-1/#comment-961 Corey Thu, 19 Apr 2007 00:35:39 +0000 http://blog.afraidtotrade.com/link-thoughts-on-moving-averages/#comment-961 Hey Jack, Thank you for your comment. Indeed, you have a wise exit strategy that is effective there. Although twice the intraday movement traded below the moving average, it never closed below. Some traders insist on "two consecutive closes below a key MA" as their exit signal, so that they are not whipsawed, but of course this could lead to larger losses, so it is best to test this parameter before using it. It really is wise to find a system or strategy for letting winners continue to perform, and taking half the position off at certain times is often wise, provided a strong and confirmed trend (usually with fundamental backing) is established and traded. This strategy is passive and allows for minimal monitoring (and minimal decisions) which is very helpful for longer term swing and position trading. You're also right in that the market is the "decider" (in terms of the average and the chart) and not the trader (subject to the 'fear' of losing profits). My best to you. Hey Jack, Thank you for your comment.

Indeed, you have a wise exit strategy that is effective there. Although twice the intraday movement traded below the moving average, it never closed below. Some traders insist on “two consecutive closes below a key MA” as their exit signal, so that they are not whipsawed, but of course this could lead to larger losses, so it is best to test this parameter before using it.

It really is wise to find a system or strategy for letting winners continue to perform, and taking half the position off at certain times is often wise, provided a strong and confirmed trend (usually with fundamental backing) is established and traded.

This strategy is passive and allows for minimal monitoring (and minimal decisions) which is very helpful for longer term swing and position trading. You’re also right in that the market is the “decider” (in terms of the average and the chart) and not the trader (subject to the ‘fear’ of losing profits).

My best to you.

]]> By: Jack http://blog.afraidtotrade.com/link-thoughts-on-moving-averages/comment-page-1/#comment-957 Jack Wed, 18 Apr 2007 23:57:34 +0000 http://blog.afraidtotrade.com/link-thoughts-on-moving-averages/#comment-957 Sorry here is the stock chart http://stockcharts.com/h-sc/ui?s=GLBL&p=D&yr=0&mn=4&dy=0&id=p09962799961 Sorry here is the stock chart

http://stockcharts.com/h-sc/ui?s=GLBL&p=D&yr=0&mn=4&dy=0&id=p09962799961

]]> By: Jack http://blog.afraidtotrade.com/link-thoughts-on-moving-averages/comment-page-1/#comment-956 Jack Wed, 18 Apr 2007 23:57:02 +0000 http://blog.afraidtotrade.com/link-thoughts-on-moving-averages/#comment-956 Corey, I am new to your site, thought I would throw in how I just used a MA for an exit. To stay with this trend I "fitted" the EMA to 8 periods. You can see it never closed below the 8 period EMA for many weeks that I held the stock. I got in at 16.80. Today I exited half my position below 20. I will hold the other half untill the previous weeks low is taken out. Both are profitable, one is for the shorter term (daily) and one is longer term (weekly) This helps me to hold the winners, let the market tell me what to do. Corey, I am new to your site, thought I would throw in how I just used a MA for an exit. To stay with this trend I “fitted” the EMA to 8 periods. You can see it never closed below the 8 period EMA for many weeks that I held the stock. I got in at 16.80.
Today I exited half my position below 20. I will hold the other half untill the previous weeks low is taken out. Both are profitable, one is for the shorter term (daily) and one is longer term (weekly) This helps me to hold the winners, let the market tell me what to do.

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