This is just a simple rule I try to follow when buying long term positions. This is not any kind of short term strategy or trend following. Its just an easy rule I try to follow to avoid buying at prices that are inflated. It's kind of common sense but you would be surprised.
Would you recommend a lower SMA like a 100 day one?
mjuhazie
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@jamawd24, Depends on what kind of trading you are doing, day trading and swing trading you would want to use lower SMA, I like the 200 MA for longer term trades and determining the trend.
hoperushing
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Do we see a pullback to this before continue higher ? Do you think it’s short opportunity here ?
ogdabber
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@hoperushing, it could keep pushing higher (easily!) but eventually it will need to accumulate/distribute -- as shown in this chart, 200ma will eventually catch up, but the 50ma and 20ma should prove helpful too... market-wide crash would put any equity in jeopardy, but this one looks good rn
lauralea
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Agree..if you werent in this one a long time ago, it is not a good time to enter unless there is a significant pull back/thx for sharing
mjuhazie
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No problem, hope it helps!
hoperushing
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Shared this on Twitter hope it’s okay
hoperushing
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Wow !! What a great advice ! Stuck in FB fomo prices purchase myself !! Great example and details of calculations too !!