Moving Average - crossover techniques

[Beginner100]

Hi guys,

A very basic beginners question again so please bear with me.

If one was to follow a moving average crossover strategy could anyone advise which time periods to use with each other please?

If it helps I am not referring to day trading or scalping.

Apologises if this has already been answered on here somewhere.

Keep safe.

Many thanks

[Caseynotes]

18 minutes ago, Beginner100 said:

Hi guys,

A very basic beginners question again so please bear with me.

If one was to follow a moving average crossover strategy could anyone advise which time periods to use with each other please?

If it helps I am not referring to day trading or scalping.

Apologises if this has already been answered on here somewhere.

Keep safe.

Many thanks

Hi, best practice is to experiment and eyeball best fit for the particular market and chart time frame you are using, there is not really a one size fits all plus some traders prefer to stay in the market longer and use wider stops than others and so will use larger period MAs. 

[Iopklm098]

moving average meens dow jones naw 24311 go to 23888

[Beginner100]

23 hours ago, Caseynotes said:

Hi, best practice is to experiment and eyeball best fit for the particular market and chart time frame you are using, there is not really a one size fits all plus some traders prefer to stay in the market longer and use wider stops than others and so will use larger period MAs. 

Thank you

[Kodiak]

You should also look at other things than crossovers

1) Crossovers

2) Price cross averages

3) Slope

4) Spread between averages

Use a pair that are common and watch them over time and learn how to use them, they tell you a lot if you know how to read them

 

[THT]

Hi

I've used MA's combo's for over 10 years - Personal preference at the end of the day, there's no perfect solution although some traders have optimised the perfect settings but its neither here nor there in terms of success.

If I'm designing a method/strategy I would manually back test it over years that include a bull and bear market sequence as you'll get every possible market type/form in those periods - From that you'll be able to ascertain the % your stop needs to be when entering and it'll tell you % gain per trade

(The charting software used below is NOT available on IG platform to my knowledge - so the DTF Indicator is unique to the trading software package I use)

[JJP]

On 11/05/2020 at 17:58, Beginner100 said:

Hi guys,

A very basic beginners question again so please bear with me.

If one was to follow a moving average crossover strategy could anyone advise which time periods to use with each other please?

If it helps I am not referring to day trading or scalping.

Apologises if this has already been answered on here somewhere.

Keep safe.

Many thanks

Common settings include the 200, 100, 50 and 20 SMA/EMA. Most traders will use these to analyse trend on longer time frame charts. I like 9 and 21 on a 5 min chart. But, I never have been able to make a cross over strategy work consistently within my risk parameters. Try plugging in the fib numbers on different time frames and back testing that. It's as good an approach as any cross over strategy.

[dmedin]

Simplest = MACD (standard settings) with 200 SMA or EMA as a filter

Edited June 8, 2020 by dmedin