If you follow my charts, you could see in the earlier years, I was hooked on using EMA as a way to guide my entry , understanding the bulls/bear trend,etc.
Later, I discovered that it can be tricky when the price hoovers around the EMA and make it difficult to decide whether to long or to buy. There can be many false alarms, so you either get in too early to buy or too late to sell.
After much researching and experimenting, I chance upon trend line and fall in love on my first application. It is simple, clear and no ifs or but.
From the chart above, we know we can sell at 3232 once the price breaks down from the trend line versus 3068 if you use the EMA indicator.
Also, the candle on 20 May 20 would be a buy if you use the 200 EMA as it close above it. However, the support turn resistance line (black) tells us to hold our horses and be patient. The price action is merely hoovering at this resistance level at 2973 but has yet to break out of it.
We neither buy as it has not yet break out nor we sell as it has not break down from the diagonal bullish trend line. We just wait and see, very simple.
We are cautiously optimistic moving into next week as the last candle this morning was a bullish hammer, a bullish signal for price to continue higher.
Have a great weekend everyone ! Stay healthy and safe !
@HaranBanjo, thanks for your comments. hope you are making great stride in your trading. cheers
TayFx
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Thanks for this! Let's spread the word, the only indicators worth our time is our eyes and brain
dchua1969
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@TayFx, thank you for your comments. I am merely sharing my experiences from using MA to trend lines. I am sure there are many who uses MA very well and make good profits out of it. If you read most analysts that share their charts, 8 out of 10 are using moving averages. So, there must be values in using them. Cheers.