Power Of The 200 SMA
The 200 SMA is considered to be one of the most powerful indicators by many professional traders. By understanding where the 200 SMA is located on the chart can tells me the direction of the trend in the market direction.
Powerful Simple Moving Average Watched By Traders Of All Levels
When I first do my technical analysis to any stock I ask where is the 200 SMA and I wrap everything else around that. I also use a pair of MACD indicators with a 20 SMA and a 8 EMA for all of my entries and exits.
Golden & Death Cross
When the 200 SMA and the 50 SMA cross to the upside and the downside they are called the “Death Cross” or the “Golden Cross”
When the 50 SMA crosses above the 200 SMA price action usually will be to the upside.
When the 50 SMA crosses below the 200 SMA price action usually will be to the downside.
The 200 SMA is considered such a critically important trend indicator for traders.