Sri Lanka Equity Forum
Dear Reader,

Registration with the Sri Lanka Equity Forum would enable you to enjoy an array of other services such as Member Rankings, User Groups, Own Posts & Profile, Exclusive Research, Live Chat Box etc..

All information contained in this forum is subject to Disclaimer Notice published.


Thank You
Sri Lanka Equity Forum

Discussion Forum for Stock Market Investors in Sri Lanka

සිංහල පරිවර්තනය
Submit Post
Submit Post
Market Place

Add an ad

View all ads

Latest topics

» Keep eye on Politics
by Teller Today at 3:39 am

» RICH is not bad @ 9/-
by Teller Today at 3:18 am

» BFN බොරු සෙලින් දාලා කොහොම හරි 11 වගේ ගානට 500000 එකතු කරගන්න කියලා අර 14 ට ලක්ශයක් සෙලින් දැම්මේ මේ ටේලර් මහත්තයාම තමයි
by Teller Today at 3:16 am

» Be careful with HVA and LITE
by Teller Today at 3:11 am

» Stop promoting garbage. Don’t get deceived.
by Teller Today at 3:06 am

» PAN ASIA POWER
by Teller Today at 3:05 am

» lOFC definitely will hit 6/-
by Teller Today at 1:22 am

» WATA future looks good
by Teller Yesterday at 10:00 pm

» If i am the EPF buyer,I will go for PLC
by Teller Yesterday at 9:59 pm

» LLUB Pattern reversed. Good buy @60, target +20%
by Teller Yesterday at 9:58 pm

» THE CURSE ON JKH
by Teller Yesterday at 9:04 am

» Why we should buy AEL.N0000…?
by Miss-Sangeetha Yesterday at 7:45 am

» Why AAIC Should trade above RS.50/-
by wisdom79 Yesterday at 6:52 am

» The Curse Of AEL
by Yahapalanaya Tue Jun 18, 2019 11:06 pm

» Senthilverl Drives Sri Lanka Stock Market Turnover to hit Rs.2 billion
by Yahapalanaya Tue Jun 18, 2019 11:03 pm

» 8 Finance companaies to be closed very soon
by samaritan Tue Jun 18, 2019 8:52 pm

» Copreus (Pvt) Ltd - Need some Information
by Copreus Tue Jun 18, 2019 12:44 pm

» BALA can come down to 9/-
by Teller Tue Jun 18, 2019 12:27 am

» MARKET UP......BUT BFL....GRAN....TAFL......
by Trader321 Mon Jun 17, 2019 4:31 pm

» TAFL - GOLDEN EGG IN POULTRY SECTOR
by Trader321 Mon Jun 17, 2019 4:29 pm

» MGT.N0000 & TJL.N0000 keep eye.
by Trader321 Mon Jun 17, 2019 3:58 pm

» TAFL.N000 / GRAN.N0000
by Trader321 Mon Jun 17, 2019 3:57 pm

» Market will test 4700
by karuna2 Mon Jun 17, 2019 1:08 pm

» Loss-making stockbrokers may not last six months
by Miss-Sangeetha Mon Jun 17, 2019 12:51 pm

» Those who are having SUGA And HDEV (Hotel Developers)coming week you all can excpect Good News to come
by Capton KIng Cool Mon Jun 17, 2019 12:25 pm

» ECL wAS 2.8 Last week Today 4.7 .Whats Next? Acme?
by Capton KIng Cool Mon Jun 17, 2019 9:02 am

» IDL IDL IDL
by Teller Sat Jun 15, 2019 6:18 pm

» Look APLA its trending to 98LKR
by Teller Sat Jun 15, 2019 2:24 am

» SAMP Oversubscribed?
by Teller Sat Jun 15, 2019 2:13 am

» Apple Lost Sales in Europe to Chinese Firms Ahead of US Huawei Crackdown
by Teller Sat Jun 15, 2019 1:44 am

» Market is On The Rise.Market PER 8.5, EPF Has entered the market curently they are buying AEL (Access Enginering)There'r lot of counters. Rich,TkyoAsir,Amsl,Osea.CINV.EXPO,JINS and Tyre.good luck
by wisdom79 Fri Jun 14, 2019 7:55 pm

» NEXT RUN People's leasing and Finance WAIT AND WATCH ENJOY RIDE..
by ddrperera Thu Jun 13, 2019 9:25 pm

» EPF Investment in Unquated copmanies .Who is responsible Previous Centeral Bank Governer and Former Regime.
by Capton KIng Cool Thu Jun 13, 2019 9:05 am

» PDL (Property Development)
by Capton KIng Cool Thu Jun 13, 2019 8:51 am

» EAST Steady at 18
by Cricketman Thu Jun 13, 2019 5:28 am

» Guys what happen these days
by Yahapalanaya Thu Jun 13, 2019 2:29 am

» its right time to buy PHAR@700
by Teller Thu Jun 13, 2019 12:50 am

» Look PAP Amazing company
by Teller Thu Jun 13, 2019 12:46 am

» Sri Lanka stocks end at near 1-month high on local buying; rupee gains
by Teller Thu Jun 13, 2019 12:33 am

» Maharaja ASI
by karuna2 Wed Jun 12, 2019 9:36 pm

» From 10th Onward no more Phillip only Asha securities lts before login go to setting and remove phillip and aply then it will work Good luck
by Yahapalanaya Wed Jun 12, 2019 5:25 pm

» ALHP WILL MOVE UP from next MONDAY
by Teller Wed Jun 12, 2019 4:20 pm

» PDL revised exit offer
by krishna Wed Jun 12, 2019 10:55 am


You are not connected. Please login or register

Sri Lanka Equity Forum » Stock Market & Forum Help » Stock Market Charts & Graphs » Chart Pattern - The Moving Averages

Chart Pattern - The Moving Averages

Go down  Message [Page 1 of 1]

1Chart Pattern - The Moving Averages Empty Chart Pattern - The Moving Averages on Sun Apr 24, 2011 8:01 pm

Quibit

Quibit
Senior Vice President - Equity Analytics
Senior Vice President - Equity Analytics
[You must be registered and logged in to see this image.]

Moving Average is a technical indicator and is used to identify the trend in price movements. The prices of a security are averaged over a period of time and the averages keep on moving with the addition of each new day's price. Moving average could be calculated for any period of your choice depending on your requirement and this is depicted by a trend line.

As for example, if you are looking at a 9 day moving average, you will add the first nine days' closing prices (day 1 - day 9) and divide it by nine (no. of days). That will give you the first point of the Moving Average line. The second point is calculated by adding the closing prices of 2nd to 10th day and dividing it by nine. The process will continue with each new day's price being added to the calculation while the foremost day's price being removed from the calculation. This process will smooth out the day to day price movements of the share and provide the general trend of the price movement.

Longer the period of the moving average the more smoother the price movement is and each new day's price being added would have a lesser impact on the trend. As such, the extreme ups and downs in the price of a share are smoothed out leaving the general trend. If you are interested in the longer term price trend of a share you can select a longer time period like 100 days. On the other hand if your concern is short term price movement you could look at, say, a 15 day moving average.

The above explained Moving Average is called an Arithmetic Moving Average. Another form of moving average is Exponential Moving Average and is calculated by adding a certain percentage of yesterday's moving average to a percentage of the today's closing price. This way you can place more value on the current price than the past data.

Signals from Moving Average

When you look at this graphically, if the price is below the Moving Average line, it is an indication of bearish behavior for the length of the trend and vice versa. Further, if the price is moving from above the Moving Average to below it then it is a bearish indication of the price trend for the time being considered and vice versa. It is important to note that this is a lagging indicator, meaning it will only signal the trend after it has actually starter and as such is a conformational tool.

Another way to generate signals from the Moving Average is to draw two moving averages with two time periods: one for a longer period than the other. Then look for crossover points to help identify periods of significant price changes. Let's look at this graphically.

[You must be registered and logged in to see this image.]

BUY/SELL signal

When a shorter term moving average (18 day Moving Average) crosses from below to above a longer period moving average (50 day Moving Average) it is a bullish signal. That is the trend will be upward and gives a BUY signal. On the other hand, if a shorter term Moving Average crosses down from above a longer term moving average it is a bearish signal and the trend will move downward. This is a SELL signal.

It is considered that the longer the Moving Average (i.e. longer the period) is the more reliable the signals will be and shorter the Moving Average is there will be more false signals or whipsaws. We will also remind you to consider other factors surrounding the company before taking the final BUY or SELL decision.

Sri Lanka Equity Analytics
www.srilankaequity.com

2Chart Pattern - The Moving Averages Empty Re: Chart Pattern - The Moving Averages on Tue May 01, 2012 1:47 pm

K.Haputantri

K.Haputantri
Co-Admin
Thank you GMNET for your contribution.

3Chart Pattern - The Moving Averages Empty Re: Chart Pattern - The Moving Averages on Tue Dec 06, 2016 10:03 pm

jehovah

jehovah
Equity Analytic
Equity Analytic
thanks..

Sponsored content


Back to top  Message [Page 1 of 1]

Permissions in this forum:
You cannot reply to topics in this forum