Saturday, March 1, 2014

Trading Scan: Price Crossing Above or Below 200 Day Moving Average

This is among the most popular way to scan the direction of the
trend for the stock for a longer period of time.

Mostly the institutions look for the stocks which have very recently
crossed the 200 Day Moving Average in either direction.

This makes 200 Day moving average a very credible point of decision
making as it implies the strength or weakness of the stock.

Once the stock crosses above or below its 200 Day moving average it tends
to remain in that direction for a longer period of time thus making the entry
for the trader easier to confirm.

So if you are a traditional sort of investor this particular scan can come in quite
handy for you to time your entries in a stock to turn into profitable trades.
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