Bab 2 How the SMA Help Identify Entry/Exit Points?
The Simple Moving Average (SMA) is often used to identify trend direction, also can be used to generate potential buy and sell signals.
When price is in an uptrend and subsequently, the moving average is in an uptrend, and the moving average has been tested by price and price has bounced off the moving average a few times (i.e. the moving average is serving as a support line), then a trader might buy on the next pullbacks back to the Simple Moving Average.
At times when price is in a downtrend and the moving average is in a downtrend as well, and price tests the SMA above and is rejected a few consecutive times (i.e. the moving average is serving as a resistance line), then a trader might sell on the next rally up to the Simple Moving Average.
Usually,
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