15 and 30 Moving Average Trading Strategy -- with David Moadel
hello friends and welcome to looking at the markets with David Modell I wanted
to give you a strategy involving not only a moving average crossover but also
a method of conformation a way to confirm I do coach a lot of people in
trading and investing and by the way if you want me to help you with your
trading you're investing putting together a trading or investing plan is
essential and I do help people to do that you can contact me anytime at David
Modell at gmail.com so a lot of my students ask me how can I get
confirmation because maybe they're using a - moving average crossover system
where they wait for the faster moving average to cross above the slower moving
average before they buy and then they might wait until the faster moving
average crosses below the slow slower moving average before they sell or
before they short and that's fine but they want to know you know can I get
some sort of confirmation signal or indicator and do I need to put up a
whole other indicators such as RSI or MACD or stochastics whatever and you
don't really have to necessarily you can use this and here's a method that might
work for you I want you to make your own decisions try it out on your own before
before you decide whether to use it or not alright so what I've got up here is
the Apple one-minute candlestick chart and I'm going to think about day trading
for this video but you can use it as a swing trader as well for example if you
use a daily or one day candlestick chart but right now I'm just thinking in terms
of day trading or intra day trading I should say so I've got the one-minute
candlestick chart you could put up the two minute the 5-minute whatever you
like it's all good so what I have here is a very common
- moving average system I've got the and these are exponential moving averages
which are very common commonly used for intraday traders they tend to use
exponential moving averages you can use the simple moving average as well if you
prefer that alright so I've got the
slower moving average up here which is the 30 period exponential moving average
and that's blue here that's the blue line that's the slower moving average
and then I've got another moving average which is a faster one which is the 15
period exponential moving average and that's red the red line okay and so what
some people do is they might just wait until the red line crosses above the
blue line okay so the 15 goes up you know clearly crosses or breaks above the
30 yes so they wait until the fat the faster moving average clearly crosses
above the slower one and then they might buy all right and they enjoy the ride up
and then they don't sell if they're using this system it's a really nice
write-up and then they won't sell until the faster moving average which is the
oops which is the they wait until the faster moving average the red line the
15 clearly crosses below the 30 which is the slower moving average and then they
get out and they might even decide to short at that point and enjoy the the
ride down if there is one and in this case there is there there was alright
and then they might you know here's another break above so they might buy
here or at least close their short position here and so on and so forth
alright but some people want a source of confirmation so what you can do to add
to this system or to modify it is to say ok I'm actually not going to buy or take
a long position until two things happen not only am I going to wait for the
faster moving average to cross clearly above the slower one but I also want to
see the candlestick close above the faster one which in this case is the 15
all right so somebody might say alright I'm not going to take a long position
until the the red line clearly crosses above the
blue one and the candlestick has a close or a closing price clearly above the
faster one which is the red line the 15 and in that I mean both of these
happened at the same time here all right so you got the cross above and the
candle was clearly closing above the 15 here so confirmation did indeed take
place here all right and so you could have taken a long position so two
conditions for taking a long position with this modified or enhanced system
wait until the faster moving average clearly crosses above the slower moving
average for example the 15 crossing above the 30 and and also wait until the
candle the current candle closes above the faster one which in this case is the
15 all right so you need two things to happen that gives you extra confirmation
that the trend is in fact upwards and that it's breaking out now what about
selling or shorting well the bearish confirmation would be wait until like we
said wait until the faster moving average clearly breaks below the slower
one in this case the 15 clearly crossing below the 30 and also the other
condition would be to wait until the current candle closes clearly closes
below the slower one which would be the 30 in this case the blue line and so you
do in fact have it happening here you've got the faster one the faster moving
average clearly crossing below the slower one the 15 below the 30 here and
the current candle did in fact close definitely close below the blue line the
slower moving average the 30 all right and so if you had sold here you'd be
very relieved because you got to avoid all this downward price
and if you took a short position a even better then you made a nice profit all
right so once again to recap this modified or enhanced system you wait for
two things to happen two conditions before you take a long position or close
out your short position either way you wait until the faster moving average
clearly breaks above the slower moving average and you wait until the current
candle closes above the faster moving average and then to close out your long
position and possibly start a short position if you choose to do that the
two conditions would be wait until not only the faster moving average clearly
breaks below the slower moving average but also you wait until the current
candle has a closing price below the slower moving average which in this case
is the 30 or the blue line all right so I encourage you if you want to try
this out perhaps with virtual trading just to see if you like it see if it's
working for you that way you're not risking any money because it's just
paper trading as they call it and I recommend that to my coaching students
to test something out back test it if you have the software and the ability to
do that and also forward test it I call it forward testing the opposite of back
testing which is to virtual trade it for a little while until you're convinced
that it's right for you that you like it you feel that it's working more often
than not working and it's working often enough for you to be profitable and for
intraday trading you can put your stop losses and all that good stuff if you
want to and your profit target and I teach people how to do that so again my
name is David Modell my email address is David Modell at gmail.com if you want
some more coaching on this I do offer that if you like this video please give
it a thumbs up on YouTube I really appreciate that leave a comment have you
tried this system is it working for you or do you have something that you prefer
as far as a confirmation for mation system that you like
feel free to tell everybody about it in the comment section so we can create a
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educational videos like this one thank you so much I appreciate it very much
I'll talk to you again soon