so you're looking at my chart here and you're probably wondering what are these
two lines what do they mean why am I using them and how can you use these
EMA's to benefit you and make more money
so right off the bat we're taking a look here I'm talking about the EMA's those
are the exponential moving averages and what those are for why they're here and
I'm going to explain what it's all about and why you should be using these and
also some of the reasons you should not just trade basically off of the EMAs and
I'll kind of break it down and look at this chart here on TT pH so you have the
estimate which is the simple moving average then you have the EMA which is
an exponential moving average the simple average is a little bit sloped the
exponentially weighted moving average is going to react faster to price changes
so when I'm trading I want the fastest reaction obviously I want to see what's
going on right now you know and I want to wait for it and the biggest thing yet
I remember though these are lagging factors the EMAs the SMAS these
indicators are not going to tell you exactly where sock is going but it might
give you an idea of where it might bounce or where there might be some
support at all so yeah think about all the other traders out there are using
these similar indicators they're also looking at the moving averages and
they're making their trades or getting their ideas from what's going on on the
chart and that's kind of what we're all looking at so we're all trading the same
charts remember that everybody's trading the same chart basically some people
have a lot more lines and there's some people are using different indicators or
using all kinds of different crazy formulas and things but we're all
looking at the same chart in the idea that we're looking at the same candles
going up down there's no real secret when it comes down to it you get rid of
everything and all you have is a candle there that's what everybody's looking at
you can add lines you can add all the stuff but end of the day really we're
all looking at the same thing we're looking at the volume looking at the
candles but the EMA's I'm going to kind of break it down moving averages give
you an idea of where the stock is kind of been where it might be headed and
where my pullback or where there might be resistance at so if you're looking
here on TT pH couple times to get the stock it jumps up way above the moving
average people recognize that they think okay it's extended you need to pull back
some and that's what happens so we get this pullback it pulls back to the
moving average area and then starts to ride higher and kind of following that
obviously moving average is following it higher there but it's keeping that nice
and the nine EMA is the blue line the 20 is the yellow line so you get up above
that resistance it pulls back find some support there it pulls down all the way
almost to the 20 there and then balances and get that nice steady trend there and
then what happens is you get this cross it gets tighter and tighter the moving
average gets tighter you get this cross and usually when you get across
something is going to happen when when the lines get really tight there it
means something's going on you got a fight going on there and you'll see what
happens here we get this cross it you know it gets really close by doesn't
cross so keep this train going higher and then right here we get this cross
and we get this drop that's kind of one of the strategies people use that you
looked at intersections where those are changing where the crosses gear has this
big sell-off how to cross there you know the nine and the twenty cross and it
just came lower lower lower and moved down here all the way to seven forty
same thing here had this big spike a crossed got this move higher did not
cross again until we got here when it sold off so had that move higher the
trends moving higher tens moving higher emai following that trend higher it's
balancing off the twenty a couple times daunting off the nine repeatedly and
moving higher you do not want to just base your trades off of that idea that
I'm going to buy here at the EMA I would look to do this at the email you need to
just understand that it's there you're using it as a indicator but we're not
just trading basically all that the biggest thing really for me is trading
off level to trading off time and sales but overall I'm kind of keeping an eye a
lot of times if I go short on a stock let's say I go short here at 860 I'm
looking to see okay it might pull back whereas go back to I might look to see
if it's going to break through this first nine EMA and then if we're going
to pull back all the way down here the twenty it returns to balance it okay
other people are looking at it they're looking at that support there they're
using the 20s on support and that's what's happening same thing here you get
this bounce it jumps up here and then cracks through there so you get a nice
sell-off and you can see how it just crashes right through the EMAs and then
kind of get stuck there the tightens it tightens and then you
get that cross there and it really crashes down overall that's kind of the
basics I'm not going to get really deep into it what it's all about but really
the big thing with the EMA is just kind of identifying the trend you can see
here big sell-off the trend the EMA moving averages are going lower lower
and we're getting that nice steady trend lower there so you're obviously looking
at like okay that's very bearish same thing here we get that cross
and get that nice steady trend higher so looking at this ok got this nice bullish
trend here and then you get here it flattens and you can see something's
going on there it's not just heading higher so I'm going to kind of look at
that like okay if I'm along here I'm going to sell if I'm sure I'm gonna look
to go short here for a possible drop and then the same thing over here once it
starts to crash down again to get that trend change so we got that bullish
trend get flat here a lot of indecision getting tighter tighter tighter and then
crossing here crashing down and moving I'm just falling it down there so you
can see a couple little balances kind of same thing kind of gets up there to the
9 pulls back so that's something to think about what your trading might want
to add this to your charts different people you know some people use
different moving averages different time frames so it's all set you got to
fine-tune over time really the big thing for me is I want to
see what other people might be looking at if I'm short here and I'm looking for
a crash where our buyer is going to be if people are going to be buying the
stock that I'm shorting if the support is going to build where would that
support maybe build at so if I'm like I said earlier if I'm short and I see the
moving averages 20 30 cents lower I'm gonna look to take profit there at
that moving average because I'm thinking that a lot of other traders are sitting
there waiting for that pullback so they can get in there on that dip so that's
kind of a thing to be looking at I want to kind of have an idea of what other
traders are looking at if I'm long where the shorts are looking to cover if
they're getting scared for a squeeze and then if I'm short where other traders
might be looking to bounce the stock and get some support built so so really the
big thing for me using the moving averages is just kind of interpreting
the chart seeing what other traders are seeing and seeing where I could be
playing where you know if I know this guy's looking over here he's seeing in
the EMA ok I know a lot of people are sitting there they're they're buying
this trend higher they're buying all the dips and then all of a sudden get that
crash through the trend and I'm like ok that's a good sign time to go short if
you aren't using the EMAs already maybe add them to your charts very easy to add
up go and add study configuration you can add different stuff there very
simple most brokers you can add it quickly and it's the EMA I'm using the
9e EMA and I'm using the 20 EMA so hopefully this helps you guys and gives
you an idea of why I use the EMA the date range
you