We are the largest Forex education provider in Botswana. We do this through extensive online courses along with one on one consultations.
We empower lives by training individuals and institutions on how to trade the forex market successfully and generate another stream of income in order to gain the financial freedom you seek. Our aim and vision are to democratize the financial markets for all citizens of Africa. We organize free seminars and webinars across Southern Africa so you can get a feel of what we do here at the Institute.
13/11/2017
Hello Guys Is that time of the year again..We are running FREE SIGNALS FOR A WEEK...If you'd like to experience signals and financial insights from proffesional traders around Africa..Message us NOW with your contact details
The Testimonials speak for themselves
Our managed account service is something which has been getting much demand. So we thought to make a post covering how they work to save the inquiries.
1) We trade in direct accordance with your risk appetite. So if you say you are a 'low risk' investor we would trade in correlation to that by risking 1%per trade and adding suitable stop losses. More of these details will be covered in your first consultation.
2) There is a minimum to fund your account. The reason there is a minimum so the traders here at the Institute Of Forex can use effective risk management by ensuring you have a sufficient account size for your trading plan. The more capital = more space to maneuver.
3) THERE ARE NO GUARANTEES, no matter your financial objective we will never guarantee the profit potential. This is the Forex markets an environment which is in no way fixed. So for your us to Guarantee your results will be a breach of our honesty policy. Last month a client with a financial objective of 8-10% made 14% almost 50% extra than expected and at the same time, a client with a larger account had a 20% financial objective only accomplished 17%. This happens because we trade in accordance with the market.
MOST IMPORTANTLY
The reason we don't charge for our managed accounts is that we make money from the volume traded on our partner's platform so it's our precedence to ensure all you guys are profitable so you can share our service with your friends and we, as a result, can grow bigger.
Anyway enough about that the charts are waiting for us but I hope this will give you a much better idea of the services we provide. INBOX NOW for enquiries!!!
The moving average (MA) is a simple technical analysis tool that smooths out price data by creating a constantly updated average price. The average is taken over a specific period of time, like 10 days, 20 minutes, 30 weeks, or any time period the trader chooses. There are advantages to using a moving average in your trading, as well options on what type of moving average to use. Moving average strategies are also popular and can be tailored to any time frame, suiting both long term investors and short-term traders. (see "The Top Four Technical Indicators Trend Traders Need to Know.")
Why Use a Moving Average
A moving average can help cut down the amount of "noise" on a price chart. Look at the the direction of the moving average to get a basic idea of which way the price is moving. Angled up and price is moving up (or was recently) overall, angled down and price is moving down overall, moving sideways and the price is likely in a range.
A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below. This is because the average acts like a floor (support), so the price bounces up off of it. In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.
GE stock chart
The price won't always "respect" the moving average in this way. The price may run through it slightly or stop and reverse prior to reaching it.
As a general guideline, if the price is above a moving average the trend is up. If the price is below a moving average the trend is down. Moving averages can have different lengths though (discussed shortly), so one may indicate an uptrend while another indicates a downtrend.
Types of Moving Averages
A moving average can be calculated in different ways. A five-day simple moving average (SMA) simply adds up the five most recent daily closing prices and divides it by five to create a new average each day. Each average is connected to the next, creating the singular flowing line.
Another popular type of moving average is the exponential moving average (EMA). The calculation is more complex but basically applies more weighting to the most recent prices. Plot a 50-day SMA and a 50-day EMA on the same chart, and you'll notice the EMA reacts more quickly to price changes than the SMA does, due to the additional weighting on recent price data.
Charting software and trading platforms do the calculations, so no manual math is required to use a MA.
NYSE EMA
One type of MA isn't better than another. An EMA may work better in a stock or financial market for a time, and at other times an SMA may work better. The time frame chosen for a moving average will also play a significant role in how effective it is (regardless of type).
Moving Average Length
Common moving average lengths are 10, 20, 50, 100 and 200. These lengths can be applied to any chart time frame (one minute, daily, weekly, etc), depending on the traders trade horizon.
The time frame or length you choose for a moving average, also called the "look back period", can play a big role in how effective it is.
An MA with a short time frame will react much quicker to price changes than an MA with a long look back period. In the figure below the 20-day moving average more closely tracks the actual price than the 100-day does.
apple MA
The 20-day may be of analytical benefit to a shorter-term trader since it follows the price more closely, and therefore produces less "lag" than the longer-term moving average.
Lag is the time it takes for a moving average to signal a potential reversal. Recall, as a general guideline, when the price is above a moving average the trend is considered up. So when the price drops below that moving average it signals a potential reversal based on that MA. A 20-day moving average will provide many more "reversal" signals than a 100-day moving average.
A moving average can be any length, 15, 28, 89, etc. Adjusting the moving average so it provides more accurate signals on historical data may help create better future signals.
Trading Strategies - Crossovers
Crossovers are one of the main moving average strategies. The first type is a price crossover. This was discussed earlier, and is when the price crosses above or below a moving average to signal a potential change in trend.
Ford ma
Another strategy is to apply two moving averages to a chart, one longer and one shorter. When the shorter MA crosses above the longer term MA it's a buy signal as it indicates the trend is shifting up.This is known as a "golden cross."
When the shorter MA crosses below the longer term MA it's a sell signal as it indicates the trend is shifting down. This is known as a "dead/death cross"
APPL MA
Disadvantages
Moving averages are calculated based on historical data, and nothing about the calculation is predictive in nature. Therefore results using moving averages can be random--at times the market seems to respect MA support/resistance and trade signals, and other times it shows no respect.
One major problem is that if the price action becomes choppy the price may swing back and forth generating multiple trend reversal/trade signals. When this occurs it's best to step aside or utilize another indicator to help clarify the trend. The same thing can occur with MA crossovers, where the MAs get "tangled" for a period of time triggering multiple (liking losing) trades.
Moving averages work quite well in strong trending conditions, but often poorly in choppy or ranging conditions.
Adjusting the time frame can aid in this temporarily, although at some point these issues are likely to occur regardless of the time frame chosen for the MA(s).
The Bottom Line
A moving average simplifies price data by smoothing it out and creating one flowing line. This can make isolating trends easier. Exponential moving averages react quicker to price changes than a simple moving average. In some cases this may be good, and in others it may cause false signals. Moving averages with a shorter look back period (20 days, for example) will also respond quicker to price changes than an average with a longer look period (200 days). Moving average crossovers are a popular strategy for both entries and exits. MAs can also highlight areas of potential support or resistance. While this may appear predictive, moving averages are always based on historical data and simply show the average price over a certain period.
15/09/2017
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