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Strategies & Market Trends : Rolling Averages, Their ins and outs and ups and downs -- Ignore unavailable to you. Want to Upgrade?

To: nasdaqian who wrote (5)	12/28/1999 12:55:00 PM
From: Drygulch Dan	Read Replies (1) \| Respond to of 31

The shorter term charts are to keep me from falling asleep and from overreacting to short term events (little turns). I think these are all simple MAs not weighted. I prefer the roundness of simples. The weighted ones seem more erratic at the turns. Its the shape of the curve and the gaps that I am looking at so the smoothness of simple MAs seems to enhance this readability. I guess I find the stock first, then apply the averages as a monitoring tool. Over time I select a set of numbers thus eliminating the tuning issue. I like to stay with the same averages for consistency on the stock over time. Its more of a monitoring tool telling me that I'm in the trend or approaching a long term turn. For instance, in the stock I am watching now, I see the long term low at 14 months ago, the 35 ma turned about 10 or 11 months ago, and the major cross over about 7 or 8 months ago. So I'm in the upward movement channel and probably at least 6 months to go before a change in major trend. But I watch the gaps, and the gap trends over time. I print my charts daily for back referencing. Whether these are optimum or not isn't too important to me. The crossovers lag too much for me to wait for its timing in any case. For example, the prior uptrend started in late 1992 with the crossover occurring in mid 1993. It ran for 3 years to mid 1996 when it peaked that was followed by a downtrend crossover in mid 1997. Obviously with these sorts of lag times you can lose a lot of advantage if you wait for the crossover. This run appears to be stronger, so I should think the next crossover will be years out. Very comforting on a day to day basis. When the gap between the current price and the 35ma shrinks I will become more concerned with timing and look for other indicators to help with that decision. Actually I have some but they are not important yet, not till the gap starts closing down. And that's another subject, though related.