It depends. I usually only ever use the moving average on the longer side, but the fact that it remains the same if the current closing price is different makes it valuable to use in a different context.
For example, let’s say you decide you’d like to move some of your portfolio. Let’s say you’re looking for a new high, or a specific stock to sell (I won’t go in-depth with the math, but you need to be able to do some math to calculate that). A move down 1.3% would be the most practical choice for you given the current price, and for your portfolio, given your current trading stance. A move between 1.3% and -1.3% is probably not the best bet if you’re looking for higher gains. Similarly, a move of the same 1% between the low 2% and the high 1% is probably better if you’re not looking to maximize your gains, and you are trying to minimize your losses.
Now, the question becomes: which of the following moves are right for you? Let’s say you have $10,000 invested. Let’s say you decide today to sell 100 shares and buy 100 shares, but that doesn’t matter to you. So I’d only recommend moving your portfolio down 0.1% (or so) if you have $10,000 for each stock. If you have $20,000 for each stock, then I’d recommend you sell $10,000 in individual shares, and buy 100 of them, as you would have a trade of $10,000 down 1.3% at the current price.
For the same reason, for the same reasons, for the same reasons, for the same reasons, and so on. You can do this over and over again. If your portfolio is small, this is very helpful with long-term goals. If your portfolio is large, it may be much less helpful.
With that in mind, the question becomes, which move is the best move to keep track of in your trading mind? I try to always use a combination of different metrics, and I’m trying to give you my pros/cons and what makes them all good or bad for you, based on your needs. I also offer strategies based on a variety of different things.
For example, for me, moving up to a 30.9% move would be great, because it would keep my portfolio up, but if I’m trying to sell a
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