[Question] Isn’t it difficult to make a living or grow your wealth with only moving averages? I think RSI and similar indicators are more clear and easier to understand, though. [Answer]
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[Question]
Isn't it difficult to live off or grow your gains with only moving averages?
RSI and the like seem clearer and easier to understand, though
This is a fairly personal impression... what do you think?
[Answer]
Hello, this is Amemiya
Indeed, some people think, “MA alone isn’t enough to sustain or grow profits.”
However, technical analysis itself is based on moving averages in the first place
the visualization and the visual information differ, but the content doesn’t change much
Also, RSI makes it quite easy to see overbought and oversold from visual inspection,
but
if you look at past markets, there are times when it becomes completely unusable
Moreover, using it tends to create a curve-fitting where you don’t revert but continue to move forward
The relationship between profit and loss is hugely important for making the capital increase feasible
By looking at both profit and loss, you evaluate how stable it is
Ultimately, even if profits look good, if losses are too heavy to handle,
it won’t be usable in actual trading
(you encounter markets with frequent losses and repeat the same pattern)
Just as you can’t redo the market,
the choice of technical analysis follows the same principle
In the case of moving averages, you center your thinking on a single line
which allows for a very flexible approach to the market
In practice
you shouldn’t be trading rigidly
you should aim for a flexible style of trading
In terms of these advantages
I don’t think there is anyone who can surpass moving averages and envelopes
So from my perspective, it’s “extremely usable”
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