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Moving Average + Price Action Trading Strategy
MA + Price Action Strategy with Example ā
Upsurge Club
December 21, 2023
Hey there šš¼
A moving average is a simple indicator that represents the arithmetic mean of prices over the past few periods. It helps us identify the underlying trend of a stock, and determine its support & resistance levels.
Although useful by themselves, combining moving averages with price action analysis can give excellent trade signals. In todayās edition, weāll be learning one such strategy.
Moving Average + Price Action Strategy
The idea of this strategy is to:
> Use longer timeframe moving averages to spot an underlying trend (weāll be using 21-period moving averages to determine trends, also known as the āGoldilocks of Moving Averagesā)
> Take an entry when a bullish pattern is seen in the daily timeframe
Hereās how you can create a long/short position according to the strategy ā¬
Long Trade:1) The price should be above the 21-period monthly and 21-period weekly moving averages. 2) Entry can be taken when:
| Short Trade:1) The price should be below the 21-period monthly and 21-period weekly moving averages. 2) Entry can be taken when:
|
Share this strategy |     |
Example - Long Trade in GODREJPROP
> An underlying bullish trend is confirmed as the price is seen above the 21-period MA in the monthly and weekly timeframes:
Price above 21-period MA since June 2023 (monthly)
Price above 21-period MA since April 2023 second week (weekly)
> A morning star forming near the 21-day MA on 26th June 2023, triggering an uptrend:
Note: Itās prudent to backtest a strategy on a specific stock/index before using it.
Learn how Mr. Kaushik Akiwatkar generated an ROI of 200% in 2022 with just 28 trades in his Price Action Options Trading Course.
Use āSTOCK10ā for a 10% discount and get the course for just ā¹359
Happy learning,
Upsurge.club
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