Analysis of EMA Technical Index
I try to express my understanding of EMA technical indicators in the simplest way.
Trend tracking-use EMA almost entirely to track and take action on major trends. As long as the closing price of the stock is below average, traders can continue to hold positions.
Dynamic support level and resistance levelThe-50-day or 200-day EMA cycle can be used as a support and resistance interval, based on which traders can determine their own trading strategies and decisions.
Moving average crossover-get buy and sell signals by using two different exponential moving averages. If the market is in a stable and strong upward trend, the indicator line will also show an upward trend; conversely, it will also hold true in the downward trend. EMA crossover indicates changes in momentum and trends. When a shorter-term EMA crosses a longer-term EMA, it indicates a bullish signal; vice versa, it is a bearish signal. In many cases, asset prices will move closer to the EMA line after the crossover is completed. Usually, the area between the two EMA lines is a good time to enter the market.
12-day and 26-day EMA are the most popular short-term average analysis tools, while 50-day and 200-day EMA are used to analyze long-term trends.
Next I will set the 12-day, 26-day, 50-day and 200-day EMA to analyze $Berkshire Hathaway-B(BRK.B.US$
Bearish signal
1.When the short-term moving averageFall belowThe long-term moving average is a bearish signal.(red arrow)
2.Share price rebounded 200 days after falling EMA support pointButThe short-term moving average is still lower than the long-term average.This is a fake breakthrough.It's not really bullish..(red circle)
Bullish signal
1.When the short-term moving averageHigher thanThe long-term moving average is a bullish signal.(green arrow)
2.Share price rebounded 200 days after falling EMA support pointAndThe short-term moving average is higher than the long-term moving averageFor bullish signals.(green arrow)
3.The share price fell to 200-day EMA support, butThe short-term moving average fell below 50-day EMA but not 200d EMAA short-term downside signal but a long-term bullish signal.(green circle)
4.Surprised to find that the moving average after the green circle is very good.The short-term moving average is higher than the long-term moving averageThe stock price has always been a bullish signal.Keep going up..![]()
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Trend tracking-use EMA almost entirely to track and take action on major trends. As long as the closing price of the stock is below average, traders can continue to hold positions.
Dynamic support level and resistance levelThe-50-day or 200-day EMA cycle can be used as a support and resistance interval, based on which traders can determine their own trading strategies and decisions.
Moving average crossover-get buy and sell signals by using two different exponential moving averages. If the market is in a stable and strong upward trend, the indicator line will also show an upward trend; conversely, it will also hold true in the downward trend. EMA crossover indicates changes in momentum and trends. When a shorter-term EMA crosses a longer-term EMA, it indicates a bullish signal; vice versa, it is a bearish signal. In many cases, asset prices will move closer to the EMA line after the crossover is completed. Usually, the area between the two EMA lines is a good time to enter the market.
12-day and 26-day EMA are the most popular short-term average analysis tools, while 50-day and 200-day EMA are used to analyze long-term trends.
Next I will set the 12-day, 26-day, 50-day and 200-day EMA to analyze $Berkshire Hathaway-B(BRK.B.US$
Bearish signal
1.When the short-term moving averageFall belowThe long-term moving average is a bearish signal.(red arrow)
2.Share price rebounded 200 days after falling EMA support pointButThe short-term moving average is still lower than the long-term average.This is a fake breakthrough.It's not really bullish..(red circle)
Bullish signal
1.When the short-term moving averageHigher thanThe long-term moving average is a bullish signal.(green arrow)
2.Share price rebounded 200 days after falling EMA support pointAndThe short-term moving average is higher than the long-term moving averageFor bullish signals.(green arrow)
3.The share price fell to 200-day EMA support, butThe short-term moving average fell below 50-day EMA but not 200d EMAA short-term downside signal but a long-term bullish signal.(green circle)
4.Surprised to find that the moving average after the green circle is very good.The short-term moving average is higher than the long-term moving averageThe stock price has always been a bullish signal.Keep going up..
Advantages-in volatile markets, EMA is more suitable for traders who prefer high-volatility market trading or intraday trends, and EMA is more responsive to price changes, so it has a greater advantage over simple MA.
Disadvantages-EMA is more sensitive, which sometimes makes it more vulnerable to error signals.
The above is only for personal point of view, welcome to discuss it together.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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