Short Term Moving Averages Oil Trading Strategies
Short term oil trading strategy will use short crude crude oil price moving average periods such as the 10 and 20 moving average periods.
In the oil example shown below we use 10 and 20 SMA to generate Oil Trading signals: the oil signals generated are able to identify the oil trend as early as possible.
Short-term Oil with Moving Averages - How to Trade Oil Trading with Moving Averages Example
Using Moving Averages
One of the most widely used methods of technical analysis used to analyze oil chart trends in scalping and intraday trading is the use of moving averages.
The idea of this moving average oil indicator is to simply enhance technical analysis before taking a oil signal to enter the crude oil trading market. Planning and setting oil trading goals in the short term according to moving average indicator helps a scalper oil trader to identify trends in the oil market and thus open a oil order accordingly.
Most of the oil signals can be generated using a specific crude crude oil price period for the Moving Average Crude Oil Trading Indicator. The oil Moving averages price period used will determine whether the oil trader will trade in the short term or long term. In addition to this, if the crude crude oil price action is above or below this moving average indicator it determines the oil trend of the oil market for the day.
If a large part of the crude oil trading market price is considered to be below the Moving average indicator, then bias oil trend for the day is downward trend. Most oil traders the use the MA as support or resistance indicator to determine where to open oil trade positions, if crude crude oil price touches the MA in the direction of the oil market trend a oil trade is then opened.
The oil moving averages are drawn and the intersection point with the crude crude oil price can be used to determine the appropriate entry and exit times when trading in the crude oil trading market. Since there is always oscillation in the oil market trends and the oil market will repeat this process of oscillating and bouncing off the MA, this can be used to generate buy or sell crude oil trading signals.
Simple moving averages are calculated and their technical analysis is based on the observation of the crude crude oil price within a particular period of time using sufficient data to calculate these moving averages. Their interpretation has provided many oil scalpers and intraday traders with lots of tips on how and when to open oil scalping trades and oil intraday trades.
Medium-Term Oil Trading Strategy
Medium term oil moving average strategy will use the 50 period MA.
The 50 period MA acts as support or resistance level for the crude oil price.
In an upward oil trend the 50 period MA will act as a support, crude crude oil price should always bounce back up after touching the MA. If the oil market closes below the indicator then this will be an exit signal.
50 Moving Average Period Support - Oil Trading Strategy Example
In a down oil trend the 50 period MA will act as a resistance, crude crude oil price should always go down after touching the moving average. If the oil market closes above the indicator then this is an exit signal.
50 Moving Average Period Resistance – Oil Trading Strategies Example
50 Day Moving Average Oil Technical Analysis
As the oil trend moves up, there is a key line you want to watch – this is the 50 day oil moving average. If the oil market stays above this 50 day oil moving average, that is a good signal. If the oil market drops below the 50 day oil moving average in heavy volume, then watch out, because there could be oil trend reversal oil signal ahead.
A 50 day MA oil indicator takes 10 weeks of oil market data, and then plots the average. moving line is recalculated everyday. This will show the oil trend - it can be up, down, or sideways.
You normally should only buy when crude oil prices are above their 50 day oil MA. This tells you the current oil market direction is trending upward. You always want to trade with the oil trend, and not against it. Many oil traders only open orders in the direction of the crude oil trend.
crude oil prices normally will find support over and over again at this 50 day oil moving average. Big investing institutions watch this level very closely. When these big volume entities spot a oil trend moving down to its 50 day line, they see it as an opportunity, to add to their trade position, or start a new oil trade position at a reasonable level.
What does it mean if your oil moves downward and slices through its 50 day line. If it happens on heavy volume, it is a strong oil signal to sell. This means big institutions are selling their share, and that can cause a dramatic drop, even if fundamentals still look solid. Now, if your oil instrument drops slightly below the 50 day line on light volume, watch how it acts in the following days, and take appropriate action if necessary.
Long-Term Oil Trading Strategy
Long term oil strategy will use long period such as the 100 and 200 MAs which act as long term support and resistance levels for the price. Since many oil traders use these 100 and 200 oil moving averages, the crude crude oil price will often react to these support and resistance levels.
100 and 200 MAs - How to Trade Oil Trading Using Moving Average Oil Trading Strategies
In Oil, traders can use both fundamental analysis and technical analysis to help determine whether a oil is a good buy or sell.
In oil technical analysis technique oil traders looking to gauge supply and demand for a oil instrument use the 200 day moving average to examine data in different ways.
Traders are most familiar with the basic oil technical analysis of the 200 day MA which is used to draw the long term support or resistance level. If crude oil market price is above 200 day MA then the oil trend is bullish, and if it is below it then oil trend is bearish.
One of the ways to measure supply and demand in oil is to calculate the average closing crude crude oil price over the last 200 trading sessions. This oil trading moving average accounts for each day going back in time and shows you how this 200 day average has moved.
The reason why the average 200 day MA in particular is so popular in oil technical analysis is because historically has been used and it produces good results for trading in the crude oil trading market. A popular timing oil strategy is used to buy when the oil market is above its moving average of 200 days and sell when it goes below it.
With this moving average oil indicator, crude oil traders can benefit from being notified when a oil instrument rises above, or falls below its 200 day Moving Average and then oil traders can then use their technical analysis to help determine if the oil signal is an opportunity to go long or short.
