Noticias del mercado & perspectivas

Definition of Moving Average In trading, moving averages are often used to smooth out price data to generate trend-following indicators. The most commonly used types are the Simple Moving Average (SMA) and the Exponential Moving Average (EMA). A Simple Moving Average is calculated by defining a period, e.g., 10—or, in other words, the last 10 candles—adding these last 10 close prices, and then dividing by 10.

This is recalculated every time a candle closes and may be plotted as a single line on a price chart. An Exponential Moving Average is often preferred by many traders because it gives more weight to recent prices and appears to be more responsive to price changes than the Simple Moving Average. Ways to Use Moving Averages in Trading Decisions – An Overview Although, like most indicators on a trading platform, a moving average is 'lagging' in terms of the information it provides, its ability to indicate trend direction and changes makes it popular.

For entry points, traders often use two different moving averages, such as a 10 and 20 EMA on a chart. When these crossover so that the 10 is higher than the 20, for example, it may be indicative of a new uptrend (and vice versa for a potential downtrend). Larger moving averages, like the 200 and 50, are commonly observed, particularly when these cross.

For instance, the 50 crossing below the 200 is termed the "death cross" and could indicate a long-term uptrend changing to a downtrend. For exit strategies, rather than waiting for a moving average cross, a more timely exit signal might be a cross between price and a moving average. This is the major focus of this article, and we will discuss this approach along with a few considerations.

Using Price and Moving Average as a Trail Stop So let us first clarify what we mean by a trail stop or trailing stop. Traditionally, a trail stop is a type of stop-loss order that moves with the market price as a trade progresses in your desired direction. For example, if you buy a stock at $100 with an initial stop of $90 and the price moves up to $110, you may "trail" your initial stop from $90 up to $102.

This means that if the trade turns around and moves back down to $102, triggering your trail stop, you would still make a minimum profit of $2 per share, even if the price continues to drop back to $90. If the price doesn't drop but continues to rise, you can move your trail stop higher, for example, to $115, then $120, and so on, until the price eventually falls and triggers an exit. In simple terms, a trail stop locks in profit and manages the risk of giving all potential profit back to the market as the price moves in your desired direction.

Many approaches systematize the use of a trail stop as part of a trading plan, rather than simply using an arbitrary price. One of these approaches is to use a moving average as a trail stop, which we will now discuss in more detail. Moving Average as a Trail Stop Using a moving average as a trail stop means that instead of setting your stop-loss at a fixed dollar amount below the market price, you set it at the level of a particular moving average.

As the moving average changes, your trail stop will move with it. For example, consider the chart below where we have entered a short gold trade on an hourly timeframe at point "A," anticipating a potential trend reversal. The yellow line on the chart is a 10EMA.

The price moves in our desired direction and closes above our yellow line (or the 10 EMA) at point "B," locking in a good profit for this trade. As you can also see, a candle's price crossed temporarily over the 10EMA at point "C" but closed below it. This is an important consideration that we will touch upon later.

Considerations for Traders There are several factors to consider when deciding which approach suits your individual trading style, and these should be tested to find the optimal strategy for you. Which MA Type?: We've already discussed the major differences between Simple and Exponential Moving Averages. Many traders, particularly those trading shorter timeframes, tend to prefer the EMA due to its greater responsiveness to trend changes.

However, just because a particular approach is right for many doesn't mean it can't be different for you. Which Period MA?: This is probably the most debated consideration. A longer EMA, e.g., 20 instead of 10, will require a more significant price drop to trigger, meaning you may give more back to the market if the drop continues.

However, this must be balanced against the possibility that any uptrend may pause and even retrace for a period before resuming its climb. MA Touch or Close?: Another key debate is whether a trail stop using a moving average should be triggered by any touch of that moving average at any time, or whether to wait for a close price through the MA. Both approaches have pros and cons, which need to be weighed carefully.

In Summary There's no doubt that the concept of using a trail stop merits exploration for any trader. Price/MA cross is a relatively easy concept to understand and implement and can improve trading outcomes irrespective of the "fine-tuning" considerations discussed. Your challenge is clear: thorough, ongoing testing is essential to refine your choice and find the optimal method for you.

Strategies Simple Moving Average (SMA) Strategy: Utilizing a 50-day SMA as a trail stop could be effective for longer-term trades. If the price drops below the 50-day SMA, you could trigger a sell order. Exponential Moving Average (EMA) Strategy: For more sensitive, shorter-term trading, a 20-day EMA could be used as a trail stop.

The EMA gives more weight to recent prices and thus responds more quickly to price changes. Price Percentage and MA Combination: You could set a rule where the trail stop triggers if the price drops a certain percentage below the moving average. For example, if the 50-day

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In the lead-up to the European Central Bank (ECB) interest rate decision this week, the market has seen significant turmoil. Firstly from the Silicon Valley Bank (SVB) failure, followed by the news that Credit Suisse’s largest financial backer is unlikely to provide further financial support. This led to Credit Suisse stock plunging by more than 28% and taking with it, the Eurozone bond yields and the Euro.

President Lagarde from the ECB had been signaling to the market, on multiple occasions, since the previous meeting that the ECB will hike rates by 50bps at the March meeting. However, with the current uncertainty especially with the banking failures seen in the US, the market has begun pricing in the possibility that the ECB hikes rates with more caution by deciding on 35bps rather than 50bps at the March meeting. This has led the EURUSD to reverse all recent gains, turning down from the 1.0750 price level to trade along the key support level of 1.0540.

If the ECB releases a decision to hike rates by less than 50bps, this would be a major red flag to the market and also indicate a slowdown in its path of monetary policy tightening, which could see the EURUSD continue with the current downward momentum. If the price breaks below the current support level and the interim price level of 1.0440, the EURUSD could see significant moves downside, supported by the cross-over of the MACD, with the next key support level at 1.0220, which was the previous swing low in November 2022. Alternatively, if the ECB maintains its previous stance and decides to hike rates by 50bps at this meeting, the EURUSD could see brief relief.

However, it would be unlikely that the price would reverse significantly, with the current market uncertainties likely to maintain the downward pressures and the 1.08 resistance level likely to hold firm.

Walgreens Boots Alliance Inc. (NASDAQ: WBA) announced the latest financial results before the market open in the US on Tuesday. The company beat both revenue and earnings per share (EPS) estimates. Walgreens reported revenue of $34.862 billion for the quarter ending February 28, 2023 (up by 3.3% year-over-year) vs. $33.528 billion expected.

EPS reported at $1.16 per share (down by 27.2% year-over-year) vs. $1.103 per share estimate. CEO commentary "WBA exited a solid second quarter with acceleration in February, adding to our confidence in driving strong growth in the second half of the year. With the closing of VillageMD's acquisition of Summit Health, WBA is now one of the largest players in primary care, with best-in-class assets across the care continuum.

Both Walgreens and Boots are performing well by delivering compelling value to consumers, playing a critical role as community health destinations, and successfully navigating a challenging environment. We will continue to take bold actions to create sustainable long-term shareholder value," CEO of the company, Rosalind Brewer said in a press release. The stock was up by around 1% in pre-market trading following the latest results.

The stock is down by 11.83% year-to-date at $32.96 a share. Stock performance 1 month: -7.29% 3 months: -14.02% Year-to-date: -11.83% 1 year: -31.12% Walgreens Boots Alliance price targets Barclays: $43 Evercore ISI Group: $35 Loop Capital: $45 Morgan Stanley: $37 Truist Securities: $42 JP Morgan: $40 Credit Suisse: $41 Mizuho: $41 Cowen & Co.: $54 Deutsche Bank: $50 Walgreens Boots Alliance Inc. is the 605 th largest company in the world with a market cap of $28.41 billion. You can trade Walgreens Boots Alliance Inc. (NASDAQ: WBA) and many other stocks from the NYSE, NASDAQ, HKEX, ASX, LSE and DE with GO Markets as a Share CFD.

Sources: Walgreens Boots Alliance Inc., TradingView, MarketWatch, MetaTrader 5, Benzinga, CompaniesMarketCap

Walmart Inc. (NYSE:WMT) announced Q4 and full-year financial results before the market open on Wall Street on Tuesday. World’s largest supermarket chain posted solid results for the quarter – beating both revenue and earnings per share (EPS) estimates. The company reported revenue of $164.048 billion (up by 7.3% year-over-year) vs. $159.759 billion expected.

EPS reported at $1.71 per share for the quarter vs. $1.518 EPS estimate. Full-year revenues reached $611.3 billion (up by 6.7% vs. a year prior) and EPS at $6.29 per share. CEO commentary ''We’re excited about our momentum.

The team delivered a strong quarter to finish the year, and as our results in the last two quarters show, they acted quickly and aggressively to address the inventory and cost challenges we faced last year. We built momentum in the third quarter and that continues. We are well-positioned to start this fiscal year,'' Doug McMillon, CEO of Walmart said in a press release following the latest results.

Stock reaction The results did not have a big impact on the share price Tuesday. The stock was up by 0.61% at $147.21 a share. Stock performance 1 month: +3.29% 3 months: -2.53% Year-to-date: +3.91% 1 year: +6.77% Walmart stock price targets Cowen & Co.: $180 Telsey Advisory Group: $165 Morgan Stanley: $161 Gordon Haskett: $155 Barclays: $159 Oppenheimer: $160 Tigress Financial: $176 UBS: $168 Credit Suisse: $170 Bernstein: $159 Walmart is the 18 th largest company in the world with a market cap of $397.31 billion.

You can trade Walmart Inc. (NYSE:WMT) and many other stocks from the NYSE, NASDAQ, HKEX, ASX, LSE and DE with GO Markets as a Share CFD. Sources: Walmart, TradingView, MarketWatch, MetaTrader 5, Benzinga, CompaniesMarketCap

The overall risk appetite in the market has increased this week following the news that the banking sector’s issues appear to have been resolved. As a result, the Japanese Yen’s status as a safe haven currency may have been hurt in this risk-on market environment. Paired with the renewed recovery in strength in the DXY, this has led to the USDJPY bouncing off the key support and round number price level of 130 to trade steadily higher.

This move higher was sustained as the price broke through the descending trendline, with the USDJPY rising toward the 133-round number resistance level, which coincides with the 38.2% Fibonacci retracement level and 100-period moving average (MA). While the USDJPY could retrace briefly at this resistance area, look for the USDJPY to break beyond the 133 resistance level and 100 MA to signal a continuation of the upward move, with the next resistance level of 135 and the 61.8% Fibonacci retracement level a possible target level. However, watch out for the developing news from the Bank of Japan (BoJ) following recent comments that the BoJ could tweak the current Yield Curve Control (YCC) if the economic and price conditions justify phasing out stimulus.

Widening of the target level or removal of the YCC could lead to a significant strengthening of the Japanese Yen.