Are you using Moving Averages Correctly? | Arthur Hill, CMT (02.25)
Next Level Charting with Arthur Hill, CMT • 14m
The 50 and 200 day simple moving averages are the two most widely used moving averages, but they should be used in very different ways. One works great as a trend-following indicator and the other is better suited for mean-reversion opportunities. Today we will backtest these moving averages over a 20-year period and show how to reduce whipsaws. Attention will then turn to identifying mean-reversion setups.
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