The model has two key parameters, including fundamentalists' mean reversion parameters [d.sub.f] and chartists' exponential moving average
The accuracy of exponential moving average
is higher because the bias level is lower and the frequency to make a forecast with the higher bias level is higher using 2 days simple moving average.
A breakout signal is given if it breaks through Dh4.56 which would also be a move through its 200 period exponential moving average
. Both are bullish signs.
It touched resistance of the 200 period exponential moving average
(upper curved line in chart) on Thursday possibly completing in the short term an almost 35 per cent move off the bottom hit July 13.
The upper curved line in the accompanying chart is the 200 period exponential moving average
long-term trend indicator.
The close was barely below the 100 period exponential moving average
(lower curved line in chart).
A minor support level is at 1,946, followed by the 100 period exponential moving average
(lower curved line in chart) in the area of 1,870, then the 1,800 price zone.
Next resistance is at 2,209.52 on the DFM, followed by the 200 period exponential moving average
trend indicator (upper curved line in price chart), which is at 2,424.
It broke through its 100 period exponential moving average
(light blue curved line), as well as having moved out of an ascending trend channel, both bullish technical signals.
The day ended with 2 major negative crossovers of exponential moving averages
This indicator is used to determine the relationship between two exponential moving averages