Stock chart moving average line theorem.

What is the moving average line?

"A line created by connecting the stock price moving average, which is the arithmetic average of the stock price over a period of time."

Therefore, the 5-day moving average line is connected by a line divided by 5 by adding the closing price for 5 days, including the day. The 60-day line is for 60 days.

Stock prices tend to move on the moving average.

In other words, when the stock price is above the moving average line, the stock price does not fall well below the moving average line with the support of the moving average line, and tends to recover quickly even if the movingaverage is temporarily broken.

This trend is well seen when looking at the 5-week moving average line.

Looking at the chart above, stock prices tend to move along the 5-week moving average line.

Conversely, when stock prices fall, the moving average line is the resistance line. Even if the stock price temporarily breaks the moving average line, it tends to fall below the moving average line again under the resistance of the moving average line.

If you look at the stock book, it's a stock where the regular arrangement goes up and the reverse arrangement goes down.

The regular arrangement is,

"It refers to the state in which the moving average line is listed sequentially from the short-term moving average line to the mid- to long-term moving average line. Stock prices generally form a trend, so if the moving average line is arranged in a regular arrangement, it is interpreted as a strong upward trend."

The reverse arrangement is,

"A reverse arrangement is when this order is reversed, with the long-term (120 days) line at the top and the short-term (5 days) line at the bottom."

In the case of a regular arrangement, several moving averages below the stock price act as support lines, so the reverse arrangement is said to be an increase in the regular arrangement and a decrease in the reverse arrangement because the moving averages above the stock price act as resistance lines.

For this reason, there are people who buy unconditionally in a regular arrangement, and when they actually buy stocks, they are often hit by a high point because the regular arrangement often collapses soon.

Therefore, even if the stock price is adjusted to make a low point, it should be purchased when it rises with the support of the moving average line, and when the moving average line, which acts as a support line, collapses, it should be sold.

One of the trading techniques using moving average lines is

It is a way to use Golden Cross and Dead Cross.

Golden Cross refers to the case where the short-term moving average breaks the long-term moving average, for example, the five-day moving average breaks the 20-day moving average, and dead cross is the opposite.

It is a way to buy it at Golden Cross and sell it to Dead Cross.

In addition, there are many other ways, such as placing importance on the 200-day line or selling soaring stocks on the 3-day line, and trading them in bolinger bands without looking at the moving average line.

However, despite various trading methods, the moving average line is an indicator that should be basically known.