These averages are crucial support points as failure to hold will pull prices back to its
long-term moving average (200-day moving average) which is currently at 7,020, Limlingan said.
It's also important, when using value and momentum theory, to: (1) exit or hedge stocks when they are in the top 20% overvalued territory, and (2) exit or hedge stocks when they are below the
long-term moving average on the S&P 500.
Analysts who study charts of past price movements said gold had now found support from a
long-term moving average.
When a short-term moving average exceeds (falls below) the long-term moving average, a buy (sell) signal is considered to be generated.
However, when VMA rule is introduced with a one percent band, a buy (sell) signal is initiated only when the short-term moving average exceeds (falls below) the long-term moving average by at least one percent.
The proposition introduced is that no local job market can sustain job growth above a
long-term moving average. The longer that annual job growth is greater than the
long-term moving average, the more likely it is that a period of job decline will occur.
'Meralco shares have been trading above both its short- and
long-term moving averages for a month now.
We are below short- and
long-term moving averages.'
However, the major trend is up as the markets are currently trading above their short-term, medium-term and
long-term moving averages. Any dip is an opportunity to buy," said Haddad.
However, he noted, the longer-term trend of the currency remains bearish as the prices remain under declining
long-term moving averages.
We advise to stay light on positions or accumulate issues which are still holding above
long-term moving averages, he said.
A cautious position is still raised this week, especially since some issues have already recovered above their
long-term moving averages. On the other hand, we recommend taking profits on trading positions or sell those which are now trading near resistance, he said.
