Moving Averages


The moving average crossover is a technical indicator that can be useful when used in conjunction with other indicators. A moving average technical alert occurs when the shorter period moving average (say 50 day) moves across the longer period moving average (say 200 day)

The problem is that many times a moving average indicator can be a false positive that leads to a whipsaw.  The key problem with moving average indicators is that they are lagging indicators.  Using moving indicators as a supplemental indicator can be useful.  Others have taken the moving average and made it more complex, thereby justifying using it alone.