Analysis Using Moving Averages

ANALYSIS USING MOVING AVERAGES

Data Analysis:

Bankex Sector(BSE)

Initially the chart of moving averages and daily stock prices for ICICI bank was prepared.The buying and selling points were identified.

ICICI Bank:Chart of moving averages and stock prices

FTSE100 Index

The chart of moving averages and the daily stock prices for the FTSE100 index was prepared using metastock software.Then the buying and selling points were identified for each moving average.Total number of trades for each moving average are determined.The total profit/loss was also calculated along with the profit per trade.

FTSE 100 Index:Chart of moving averages and stock prices

Observations

Bankex Sector(BSE)

Refer appendix 2

If the trading is done following the concept of moving averages, then the number of trades are higher for short period of moving averages.

Even though the number of trades done are more for short term moving averages,the profit per trade is low.Whereas the profit goes on increasing with the increase in the period of moving averages.

FTSE100 Index

Refer appendix 2

If trading is done following the concept of moving averages,the number of trades obtained are higher for short period of moving averages.

Total profit decreases with the increasing period of moving averages while profit per trade increases.