How reliable are Mov. Avgs crossovers as Future support/
resistance points ??? Am experimenting with 30 min C/stick
chart with 5 period ema, 9ema, 14ema and 50 ema plus a 3 month/ daily chart with the same period ema's.
reddragon, I suggest you take a look yourself. It depends how you use MAs. There's no magic, no system and nothing is 100%. Anyone who trashes a method has a closed mind. It obviously doesn't work for Grey1 but you'll find a lot of successful traders here who use them.
I have found MACD combined with simple MA works extremely well on 5min spot forex (EURUSD in particular) mainly because the trends tend to have more momentum once they get going than the indices - therefore the lagging aspect is ok. BUT the indicator is near useles if it is flatlining. In which you probably won't be in the market anyway. And the other thing of course is, that you would never trade all crossovers - you still have to look at the strength of any move before you can decide the likely potency of the signal - but I think that it is the same for all oscillators.
Great thread to start - loads of traders use this as their primary tool I think - interesting to see what people really think.
MA's and MACD's are lagging indicators. As such they do not have predictive abilities. They do, however, excel at indicating the trend, or a change in trend.
The correct time to use them is in trending markets, when you will make a mint. In rangebound markets you'll get wiped out on the whipsaws. Unfortunately MA's on their own are not good at indicating the type of market, IMO.
Has anyone looked at the way in March most stocks have reversed and some much more than others. This might be a silly question BUT, as you can tell a lot of 200MA are going to go up in a sustainable way. Can anyone tell me whether this will guarantee a sustainable rise in FTSE 100 equities? I get the impression it will!!!