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