200 Day Moving Average

Whether you are a swing trader, a day trader, a stock market investor, the importance of having a 200 period moving average on your charts cannot be emphasized enough.

As with all other technical analysis indicators, the 200 period moving average acts as a supernatural being in stock market trading.

If you want your online stock market trading to be successful, you have to do yourself a favor and include a 200 day moving average on all your charts and on each time frame whether it is a trading time frame or a technical analysis time frame.

So what is the 200 day moving average?

The 200 period moving average is a symbol of strength and power. It is an average price of 200 periods in a time frame.

This length of time represents solid history on the stock or market’s price action and thus this moving average commands respect. The stock market is a game of probabilities.

In the long run, you will reap the rewards of success if continuously stack the probabilities in your favor. There are also rules and laws that stock market traders and day traders have to follow for their success in the stock market game.

While a majority of listed stocks belong to US based companies, foreign companies are able to list their companies on the NYSE provided that they adhere to the guidelines established by the SEC.

One of those every important law is the law of “always respecting the 200 period moving averages”.

As noted earlier in our lesson, the 200 period moving average akin to a supernatural being.

When you understand, listen to and respect the 200 day moving average you are less likely to enter trades that go against the 200 period moving average rule.

Read Part 2 Of the Importance of the 200 day moving average

• Understanding the 20 Day Technical Analysis Moving Average
• Stock Market for Beginners: understanding the 50 day moving average
• So what is the 200 day moving average?
• the 200 period moving average, can lead to one of the most lucrative trades