Moving averages

[darksentinel]

Cheers DS, not a huge sample but impressive results all the same. I'm assuming on something like a 31 SMA the average hold time would have been relatively compact for your 48%?

Yeah, as I said, indicative. It's just some data I had on hand that I'd been playing with. I've locked at a couple of stocks, and they give interesting results for using the crossing points of two different MAs.

Here's a spreadsheet of what I'd been doing using a 29 SMA/Price cross: http://dl.dropbox.com/u/44057876/NZX50.xlsx. It clearly shows the triggers and the problems (e.g. 26 trades were only held for 1 day). Average holding period was 15 days, but if you remove everything 1-day trade, then average holding period goes up 25, pre-brokerage profits go up to 97.7% and of course brokerage costs go down as well.

NB: all % gains are non-cummulative (non-compounding).

And yes, this is back-testing and data-fitting. Just making the point that MAs can be a useful (and simple) tool

[Snow Leopard]

Yeah, as I said, indicative. It's just some data I had on hand that I'd been playing with. I've locked at a couple of stocks, and they give interesting results for using the crossing points of two different MAs.

Here's a spreadsheet of what I'd been doing using a 29 SMA/Price cross: http://dl.dropbox.com/u/44057876/NZX50.xlsx. It clearly shows the triggers and the problems (e.g. 26 trades were only held for 1 day). Average holding period was 15 days, but if you remove everything 1-day trade, then average holding period goes up 25, pre-brokerage profits go up to 97.7% and of course brokerage costs go down as well.

NB: all % gains are non-cummulative (non-compounding).

And yes, this is back-testing and data-fitting. Just making the point that MAs can be a useful (and simple) tool

If you wish to reduce the whipsawing of having entry and exit based on a single MA then you modify you entry criteria to when the price rises a few percent above the MA and you sell when the price drops a few percent below the MA.

Still a simple system but with two independent variables to play with giving you hours of fun.

However you go about determining a useful system getting your exits conditions right and sticking to them is more important than getting your entries right.

best wishes
Paper Tiger

[Aaron]

I have shares in AGL that have done OK in a little over 10 months.

It was a punt based on a morningstar recommendation.

A transition to green energy and an activist shareholder has me thinking this is no longer the dividend payer I was after and not very comfortable with it.

Morningstar still has a $13.30 valuation but now only an "accumulate" recommendation. (seems odd as the recommendation price is currently 51% above todays price. That sounds more like a buy to me if you believe in your valuation)

My question is I am happy to let my profits run but on a purely technical basis what would you look for in price movements to sell at the simplest level. E.g. crossing the 90day moving average or would you use a longer time period.

Indicators on the ASB securities website are volume, RSI and Stochastic fast and slow I assume a lot of the price movement has been the billionaire buying his stake in the company.

Torn as I don’t want to sell in case Morningstar is right and I have another 51% upside in capital appreciation but not comfortable with the company. I was thinking maybe TA can stop me selling out too soon.

The slow Stochastic squiggle is above 80 I guess sell if it drops below that.

Any thoughts appreciated.

[Aaron]

I have shares in AGL that have done OK in a little over 10 months.

It was a punt based on a morningstar recommendation.

A transition to green energy and an activist shareholder has me thinking this is no longer the dividend payer I was after and not very comfortable with it.

Morningstar still has a $13.30 valuation but now only an "accumulate" recommendation. (seems odd as the recommendation price is currently 51% above todays price. That sounds more like a buy to me if you believe in your valuation)

My question is I am happy to let my profits run but on a purely technical basis what would you look for in price movements to sell at the simplest level. E.g. crossing the 90day moving average or would you use a longer time period.

Indicators on the ASB securities website are volume, RSI and Stochastic fast and slow I assume a lot of the price movement has been the billionaire buying his stake in the company.

Torn as I don’t want to sell in case Morningstar is right and I have another 51% upside in capital appreciation but not comfortable with the company. I was thinking maybe TA can stop me selling out too soon.

The slow Stochastic squiggle is above 80 I guess sell if it drops below that.

Any thoughts appreciated.

No advice forthcoming so sold as the 80 line was hit as well as a financial hurricane coming. Interesting to see what I missed in 12 months $8.80 on the 9/6/2022.