What Are Moving Average Crossovers?

By Ahmad Hassam

A moving average (MA) is one of the most basic technical indicators and is an average of a predetermined number of prices such as the closing prices calculated over a number of periods like 100 candles. The higher the number of candles in the average, the smoother the moving average line is. The lower the number of candles in the candle, the choppier it is.

Moving averages are of two types: Simple Moving Averages (SMAs) and Exponential Moving Averages (EMAs). SMA is only an average obtained by adding all the candles that you would like to measure. The EMA responds more quickly to price changes as compared to SMA because it pays more attention to newer candles.

A moving average makes it easier to visualize price action without statistical noise. Instead of watching the up and down behavior of each candle, you are watching the relatively smooth moving average line.

Moving averages are lagging not leading indicators. Its signal occurs after the new price movement not before it. Moving averages do not think ahead. They can tell you what has happened, not what will happen.

Still, moving averages have a critical role to play in planning your trades in advance. Past does not always predict the future but it sure likes to repeat itself. Several different moving averages are used at once. They offer different pieces of the puzzle when planning our trades.

MAs keep us in our trades when the market is steadily rolling forward. Suppose something changes like the moving average crossover. Its time to get out or trade the new direction. MAs are frequently used as price filters.

To filter choppier price action into a reliable indication for true price action, a short term moving average has to cross a long term moving average. The most obvious use of moving averages is to watch for crossovers to confirm new trends.

Short term MAs are more sensitive to price action as they are measuring fewer candles. Longer term MAs are less sensitive to price action. Longer term MAs tend to be more flat and are less likely to whipsaw up and down.

When MAs do crossover, you should take notice at once and if the fast EMA crosses below the slow EMA, it is predicting new downward price action. However, if the fast EMA crosses above the slow EMA, it is predicting a new upward price action.

MA crossovers often occur too late and will put you in the market with an unfavorable risk to reward ratio. Beware such crossovers should not prompt you to jump into a trade at once.

A moving average crossover should be part of the trade plan that you have developed in advance. Not every moving average crossover is the same. MA crossovers are great as they are easy to see. A MA crossover will immediately attract your attention but it cant simply replace the work of planning your trades. - 23212

About the Author:

Mr. Ahmad Hassam is a Harvard University Graduate. He is interested in day trading and swing trading stocks and currencies. Discover A Revolutionary New Forex Robot. Develop your own Forex Trading System.

FAPTurbo, a System That Lives up to Its Reputation

By Alex Miller

How many times have you heard that it was possible for you to set up a software program when your computer and basically have the print money for you. Although many of us are skeptical whenever we hear things like this, there are some possibilities as far as the Forex market is concerned. Some of these automated systems are actually quite good, provided you use the right ones.

Although there are dozens of these automated systems that are available, there are very few that are worth their weight and even fewer that we would trust in real-world experience where actual money was being traded. One that we do trust, however, along with an increasing number of Forex traders is FAP Turbo, an automated program that has hit the markets like a storm.

There are a number of different criteria that we look for whenever we are testing one of these programs. I have to admit, automated Forex trading is one of my favorite things to test, simply because it yields some interesting results, either to the good works of the bad. As in the case of FAP Turbo, however, I have to admit that it was all good. Our test account ended up in the positive and that is why it ranks so well.

The first thing that we typically look at is the website and sales letter for the program itself. The FAP Turbo website makes a number of different claims that we found very interesting. At the very core of these claims, however, was one that stated that all you needed to do was to set the program up on your computer one time and start it running. From that point forward, it will be able to make you money on autopilot.

There were also a number of different testimonials that were available in the webpage which said time and time again that the individual was able to make money on the Forex market using this program. Some of them claim to be raw beginners and were still making good money with FAP Turbo.

It is all well and good to hear what a company has to say about itself but it is entirely another thing to hear what other people have to say about them. Our own independent testing showed positive returns whenever we used it on our test platform. We also follow a number of other testers who do similar to what we are doing and all of them had positive results with FAP Turbo as well. In fact, we did not find it one independent testing facility that did not make money with this program.

Finally, we make sure that we check to see what actual users have to say about the platform or program. In the case of FAP Turbo, there were some very positive experiences that people were having to did not have a vested interest in the program at all. We would still suggest that you make sure that you still look at the program and use your own common sense when trading on the Forex market. Even so, however, it can be a program that can help you to make consistent money and at times to do so on autopilot. - 23212

About the Author:

For more information about how the FAP Turbo system can automate your trading, visit our website

Automated currency trading - No BS Trading recommendation from a Real Pro .

By Michel Brockworth

You are going to look stupid and lose if you read a lot of the rubbish written online, you can trade with some losses here and there or no losses but even the best currency trading strategies, will lose for weeks on end. You may face losses and the market making you look stupid - are you handle this and stay on course?

When you trade you want to know Your edge when you trade you must know your trading edge - this is the exact reason (defined) which implies you will appear a winner, when 95% of traders lose. If you do not know what your trading edge is - you do not have one and will lose.

It's a challenge but you can make large profit if you know what you're doing. To several amateur traders like to follow like sheep and get slaughtered.

You need to stand on your own and take responsibility - are you ready to do that?

You will learn the fundamentals this means not only learning how and why the markets work - but why you are trading system will steer you to success, so you can get confidence in it and the willpower to follow it.

Are you prepared to do this?

you want to trade in isolation In common-or-garden life, we are taught to conform with the majority and hear pros. In foreign exchange trading you must disregard the majority view, as the majority lose! Can you able to forget the majority and follow your own path?

Other traders think trading expert news is a way to win and others trade from the tummy and they all end up with a and all of equity for their difficulty. On the other hand the trader who learns the right FOREX trading basics and has confidence and discipline can make giant gains.

You don't have to work diligently to win. This has got zilch to do with working hard (you don't get rewarded for effort just being correct with your trading signals), it's to do with working smart, learning the right currency trading basics and having the right perspective to stand alone and win. So if you want a challenge, currency trading will give it to you and having the right attitude and a burning desire to succeed, you might be on the way to a great second or life changing income. - 23212

About the Author:

If you wanted to find out how to finally start trading like a REAL pro -Then this is the most important letter you will ever read: Automatic Forex Trading

Your Forex Trading System and Your Forex Career

By Bart Icles

If participating in the lucrative and dynamic foreign currency exchange market has crossed your mind, you might have thought of grabbing the opportunity right then and there. Indeed, the prospect of engaging in forex trading is merely sitting out in the open. Come to think of it, one does not need to leave the confines of his home to participate in forex trading. All that one needs is a computer and an internet connection - and you can start your forex trading career in the comfort of your own home or at your office or practically anywhere you might be.

To a lot of people, the forex market is a complex trading ground, especially for beginners. Most find it hard to participate in the actual trading because of the many factors that one needs to be aware of. However, almost everything is possible in the forex world. Armed with the basics and tips from seasoned traders, one can start participating in forex trading.

As one goes through forex trading, he will need to have a forex trading system - a good forex trading system. Success in forex trading does not come to those who settle for the mediocre. A lot of beginners experience early failure because they avail of phony forex trading systems. Large as it is, a lot of swindlers abound the forex market and they can rip people off anytime. Therefore, finding a legitimate forex trading system is one key to success in this volatile market.

It is important that one should not allow himself to be overwhelmed with expensive forex trading systems. It is also not wise to settle with trading systems that promise quick and easy profits with minimal risks. One should remember that as many as the opportunities that the forex market offers, the same number of risks abound.

In order for one to trade like a forex market pro, one needs to learn how to use forex trading systems - and one has to be really serious about learning it. One thing to take note of is that good forex trading systems are dynamic. Good forex trading systems can provide daily market advice, manuals, and many other forex trading resources that can help turn you into a successful forex investor. Gathering feedback from users of different forex trading systems can also help. It is also helpful to do some research on the company that released a certain trading system - check if that company has good reputation in the market.

Perhaps the best way to learn more about the forex trading system you have chosen is through doing practice trades with it. Nothing beats doing a lot of practice with your forex trading system. Not only can you learn how to easily read trends and market signals, you can get a good feel of how you can make profits with the help of your forex trading system. - 23212

About the Author:

Learning Forex starts with a desire to learn and a drive to become a great trader. A Forex Trading takes dedication and a good teacher. But once you learn how to trade and do so successfully your life will change and you have options and financial resources you never had before.

To Learn Technical Analysis Means Understanding the Inside Bar

By Chris Blanchet

As far as learning technical analysis goes, many investors will make short-term trades based on longer-term, "solid" patterns such as the head and shoulders top covered previously in this series. The problem with relying on solid patterns is that they are generally longer-term in nature and may not produce the short-term returns one hopes for.

The inside bar pattern is one such pattern from which investors can take short-term cues. This pattern indicates a possible change in investor sentiment in the short-term. In other words, if the overall trend has been heading down, the inside bar often indicates a reversal in that trend.

Spotting an Inside Bar

For investors who are learning technical analysis, identifying the inside bar might be a little more difficult. It involves a taller bar one day, followed a smaller bar the next. The smaller bar consists of a trading range within the preceding day's taller bar.

Confirm The Pattern

One thing many investors understand is that an inside bar should never be used in isolation when making trade decisions. When learning technical analysis, it makes sense to find support for other patterns and trends in other analysis. With the inside bar, investors should consider support and resistance levels, momentum readings, and other fundamental data relating to the security, sector, and market as a whole.

When it comes to analyzing the inside bar pattern, investors will achieve better trading results from this pattern when the inbound trend is steeper. Additionally, investors will want the first bar to be longer, which suggests the inbound momentum has climaxed. As for the second bar, the narrower the better as this indicates that the reversal will be more dramatic.

Finally, volumes should be smaller on the inside bar than on the first bar.

When it comes to learning technical analysis, investors should remember that there are many other indicators that need to confirm their trade decisions. As well, there are plenty of specialized software programs available to make simple buy and sell recommendations. - 23212

About the Author:

Chris Blanchet has more than 16 years of experience as a Financial Advisor at one of the world's largest banks by market capitalization. To learn technical analysis free visit Online Trader Today.com where Chris writes about Technical Analysis and Options trading. Chris also maintains a debt-free blog at How To Repay Debt.com