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200 MA on a daily chart

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Guest Tim Ricketts

I want to put in a 200 moving average on the daily chart, why can I not apply it.

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Hi Tim, you should be able to put any MA on any chart on any platform. On the new platform look for Moving averages in the 'indicators' section and this will place the defaults on the chart, then click on the MA box bottom left of chart to open MA options as per pic, set any numbers and colours.

ma1.thumb.PNG.73bc4ffc490c8178b5fee42e03a5bd27.PNG

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@Caseynotes, I must admit I did not know this. I had been using other software for my 200 day moving averages. 

Sometimes I do wonder if you either work for IG as you certainly seem to know so much.

IG should really be employing you or at least certainly paying you for the sheer time you spend helping everyone.I doubt IG staff in customer services do as much as you!

Thank you very much for this. Though it was not my question, it was certainly helpful to me and I am sure others. 

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Most kind @TrendFollower, I'm happy to provide an answer if I can though admit I don't always get it right, would probably cost IG a fortune in compensation if they were actually paying me. The key with a new platform (and indicator for that matter) is to get on demo and play around to your hearts content, click everything, change everything, then change it all back, then change it all over again. Then start playing around with the dealing side, put ludicrous trades on just to see what happens, it's great fun.

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@Caseynotes, sound advice.

200 MA is very important as it can really give you a good indication of the long term trend. Also when the price joins the 200 MA then it does show support when the price is above the 200 MA and resistance when the price is below the 200 MA. 

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Very true @TrendFollower, the 200 day MA is probably the gold standard indicator especially for stock traders but is important in most other markets as well. I saw a poll on favourite indicators for stock traders recently and the humble MA was the easy winner.

It tells direction, trend, momentum, force, speed and, as you say, can act as support and resistance because it is used by so many traders (and algos).

Just looked at that pic above again and compared it to the MA I'm currently playing about with.

This one has 40 odd different settings just for the 'Price to use' box alone. Hog's heaven. >>

image.thumb.png.9a096987240f9eb64980be00d6fa5259.png

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@Caseynotes, WOW!

One important thing about moving averages is that they do not predict the future price behaviour. They merely show us how the price is behaving on average over a period of time.

Crossovers can be vital for trend followers. So for example when the 50 day moving average line crossed the 200 day moving average line this could be a signal to go long. Now if the opposite happens it could be a signal to go short or to close a long trade. 

If you combine moving averages (price action - behaviour) with volume then it becomes even more important. In theory a rising trend upwards should be supported by increase in trading volume and downward trend should be supported by declining volume. This does not always occur as simple as I have explained.

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@TrendFollower,  Been out looking for a 'Death Cross' or a 'Golden Cross', interestingly the Dow chart shows how narrowly a death cross was avoided just recently (using the 50 and 200 SMA).

image.thumb.png.c72ee9987621a83cc2f7e2f5cefb996d.png

Though we're not limited to just the sma, I look forward to seeing these 20 odd variations of the ma appearing on the IG platform soon. ?

image.png.9d961f26d8943b542018a5cae2771d16.png

 

 

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The 'Golden Cross' and 'Death Cross' are opposites. They both are important indicators should they materialise on whether to consider a long or short position. 

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Thanks both - can I just reiterate thanks to @Caseynotes and @TrendFollower, both of whom are very helpful in supplying assistance to other community members, market updates, and trade ideas :) For those unaware we will always try and be as transparent as possible, where all employees of IG have 'staff' or 'administrator' against their names (in red) and generally have 'IG' in their forum names. 

Thanks again fellas. 
 

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