What does it mean to fall below the 200-day moving average line
Hello, this is Nikkei OP Day Trader, the administrator.
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Now, the theme this time is200-day Moving Average Line.
As of September 7, the position of the Nikkei average moving averages is as follows.
5-day moving average 19,468.00 (decreasing)
25-day moving average 19,600.72 (decreasing)
75-day moving average 19,869.85 (decreasing)
200-day moving average 19,396.83 (increasing)
September 7 close 19,396.52
Since September 6, the Nikkei closing price has fallen below the 200-day moving average.
I pay attention to the 200-day moving average because it is the average over roughly the past year.
In other words, simply put, and roughly speaking, it is the average purchase price over about the past year. Note) In practice, it may be better to use a volume-weighted average.
If the closing price falls below this level, people who bought every day at closing price over the past 200 days would be in a loss. Therefore, at this level, a squeeze of selling pressure may occur.
Right now, the 200-day moving average is still rising daily, but if it starts to descend and the closing price remains below this 200-day moving average, the 200-day line will become a resistance, and the correction may last longer.
Note) The above is my personal view and is intended solely to improve financial literacy. Therefore, it was not created for investment solicitation purposes. Please make actual investment decisions at your own risk.
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