How to Choose a Gold Moving Average to Trade With - Leading Technical Gold Trading Indicators - Leading Gold Trading Indicators
Choose a Moving Average to Trade With Gold Trading Strategies - Moving Average Leading Technical Gold Trading Indicators - Moving Average Leading Gold Trading Indicators
A gold trader can choose a moving average based on the gold trading chart time frame that he is trading; the gold trader might choose to use this Moving Average indicator on the minute gold trading charts, hourly gold trading charts, day gold trading charts or even weekly gold trading charts.
The gold trader can also choose to average the closing gold price, opening gold price or median gold price.
Moving average gold trading indicator is a commonly used indicator to measure strength of gold trading trends. The data is precise and its output as a moving line can be customized to a gold trader's preferences.
Using the gold trading moving average is one of the basic ways to generate gold trading buy and sell trading signals which are used to trade in the direction of the gold trading trend, since the Moving Average indicator is a lagging indicator and a gold trading trend following indicator - this means that it will tend to give late gold trading entry signals as opposed to leading gold trading indicators. However, as a lagging gold trading indicator it gives more accurate gold trading signals and is less prone to whipsaws compared to leading gold trading indicators.
Gold Traders choose the moving average period to use depending on the type of gold trading they do; short-term gold trading, medium-term gold trading and long-term gold trading.
- Short-term gold trading: 10 -50 MA Period
- Medium-term gold trading: 50 - MA 100 Period
- Long-term gold trading: 100 - MA 200 Period
The gold trading price period in this case can be measured in minute gold trading charts, hourly gold trading charts, day gold trading charts or even weekly gold trading charts. For our example we will use 1 hour gold trading chart time frame period.
Short term gold trading moving averages are sensitive to gold trading price action and can spot gold trading trends signals faster than the long term moving averages. Shorter term gold trading moving averages are also more prone to whipsaws compared to long term moving averages and a gold trader should choose a gold trading price period that will generate a gold trading signal early but not give too many gold trading whipsaws.
Long term gold trading moving averages help avoid gold trading whipsaws, but are slower in spotting new gold trading trends and gold trading trend reversals.
Because long term moving averages calculate the average using more gold trading price data, it does not reverse as fast as a short term gold trading moving average and it is slow to catch the changes in the gold trading trend. However, the longer term gold trading moving average is better when the gold trading trend stays in force for a longer time but may also give late gold trading signals.
The work of a gold trader is to find a moving average period that will identify gold trading trends as early as possible while at the same time avoiding fake-out signals ( gold trading whipsaws).