Great tool that identifies changing trends, breakouts, and trading opportunities in the price of an asset by combining two groups of moving averages (MA) with different time periods. There is a short-term group of MAs, and a long-term group of MA. Here in the image I'm showing the slow MAs and 2 of the fast MAs.
-When the short-term group of averages moves above the longer-term group, it indicates a price uptrend in the asset could be emerging.
-When the short-term group falls below the longer-term group of MAs, a price downtrend in the asset could be starting.
-When there is lots of separation between the MAs, this helps confirm the price trend in the current direction.
-If both groups become compressed with each other, or crisscross, it indicates the price has paused and a price trend reversal is possible.
-Traders often trade in the direction the longer-term MA group is moving, and use the short-term group for trade signals to enter or exit.