afoqafozurer
10-14-2016,
I get many PM's asking me what moving averages I use. Since the SMA(200) is widely considered an important reversal, support and resistant line, I use it in all my time frames. Here they are.
These are all simple moving averages(SMA)
MA(200)
MA(100) which equals to the 3.25 hour MA(200)
MA(31) which equals to the hourly MA(200)
MA(15) which equals to the 30 minute MA(200)
So if you are watching a daily chart with these MA's, you can also see what the stock is doing on an hourly basis. Lets look at PIR today. I went short yesterday 1000 shares @ $6.09. Why? It is in a downtrend with lots of resistance ahead. It was approaching MA(15), the same as the 30 minute ma(200), which was major resistance. Today PIR gapped down and is trading at $4.83 with much more downside. I did not anticipate a selloff like this, but I anticipated resistance and a pullback. I also went short NYNY yesterday, 5000 shares at $2.88 because it too is in a downtrend and it was approaching resistance at the ma(15). Today it touched the ma(15) and is going down. Currently it is at $2.74. Moving averages are pretty powerful because so many traders use them.
NYNY's chart: http://tinyurl.com/67fud5
PIR's chart: http://tinyurl.com/5s8tkz
It is very important if you are going short a stock to make sure it closed below the daily MA(200) and that the MA(200) is pointing down as in the two examples above.
Look at CEGE. It is trading below the MA(200) and making an attempt to climb above it again(wishful thinking for the longs). If somehow it crosses above the MA(200), I will wait for the next resistance at the MA(15) and go short. CEGE: http://tinyurl.com/4m7gfc
These are all simple moving averages(SMA)
MA(200)
MA(100) which equals to the 3.25 hour MA(200)
MA(31) which equals to the hourly MA(200)
MA(15) which equals to the 30 minute MA(200)
So if you are watching a daily chart with these MA's, you can also see what the stock is doing on an hourly basis. Lets look at PIR today. I went short yesterday 1000 shares @ $6.09. Why? It is in a downtrend with lots of resistance ahead. It was approaching MA(15), the same as the 30 minute ma(200), which was major resistance. Today PIR gapped down and is trading at $4.83 with much more downside. I did not anticipate a selloff like this, but I anticipated resistance and a pullback. I also went short NYNY yesterday, 5000 shares at $2.88 because it too is in a downtrend and it was approaching resistance at the ma(15). Today it touched the ma(15) and is going down. Currently it is at $2.74. Moving averages are pretty powerful because so many traders use them.
NYNY's chart: http://tinyurl.com/67fud5
PIR's chart: http://tinyurl.com/5s8tkz
It is very important if you are going short a stock to make sure it closed below the daily MA(200) and that the MA(200) is pointing down as in the two examples above.
Look at CEGE. It is trading below the MA(200) and making an attempt to climb above it again(wishful thinking for the longs). If somehow it crosses above the MA(200), I will wait for the next resistance at the MA(15) and go short. CEGE: http://tinyurl.com/4m7gfc