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Q. In the Jan/Feb issue of YTE UK you wrote about using indicators in your trading. Although I know you do not use many indicators, I am an avid reader of your Daily Market Action Letter and see that you apply moving averages to many of your index charts. A lot of traders seem to use them, but I have never been able to produce consistent results with them. Can you offer me any advice?

A. Moving averages are one of the oldest forms of indicators used by technical traders. One of the most popular catchphrases used by traders is ‘the trend is your friend’. The primary purpose of a moving average is to facilitate the identification of a trend and to gauge its momentum. So it is no surprise that moving averages are also the most popular indicators. I think many traders are lured into the false belief that because moving averages are popular, they should also be relatively simple to apply. If this were the case, making...

Toni Hansen is a full-time trader, as well as a popular lecturer and market columnist, who has been sharing her knowledge with  others over the past decade. To learn more about Toni's methods, go to www.tradingfrommainstreet.com

This article was originally published in the Mar/Apr 09 issue of YourTradingEdge magazine (www.YTEmagazine.com). All rights reserved. © Copyright 2009, MarketSource International Pty Ltd. If you are not a subscriber, click here to subscribe, or to purchase this issue as a single back issue, click here.