NOW LET ME EXPLAIN THIS DATA :
YOU WILL OBSERVE THAT THE FIRST 2 BUY SIGNALS IN 8 SMA AND 15 SMA WERE GENERATED ON 28TH MAY, 2012. ON THIS DAY THE FIGURE OF (33.24) IN 8-34 I.E. COLUMN K IS ALSO SHOWING AN INCREASING TREND COMPARED TO PREVIOUS DAYS….THUS BUY ON 28TH MAY IS CONFIRMED AND LTP WAS 411.85…..
THEREAFTER YOU WILL SEE AN UPTREND IN PRICE….HOWEVER ON 1ST, 4TH & 5TH JUNE THE PRICE HAS FALLEN BUT THE FIGURE IN COLUMN K (8-34) IS STILL SHOWING AN INCREASING TREND, THEREBY INDICATING THAT THE TREND IS UP AND THE “SELL” SIGNALS GENERATED IN 8 SMA AND 15 SMA ON THOSE DAYS ARE "FALSE"….
THOSE WHO WERE HOLDING LONGS FOLLOWING THIS UPTREND WILL SEE THAT TATASTEEL KEPT MOVING UP DAILY THEREAFTER AND MADE A HIGH OF 444 ON 29TH JUNE, 2012…..
IT IS STILL IN UPTREND AS THE FIGURE IN COLUMN K (8-34) IS STILL INCREASING.
FOR EXAMPLE, TO GET 8 SMA SIGNAL, FOLLOW THE BELOW STEPS :
1. WORK OUT 8 DAYS SMA, WHICH IS SUM OF LAST 8 DAYS LTP DIVIDE BY 8.
2. IF TODAY'S LTP IS HIGHER THAN 8 SMA COMPUTED IN 1, IT IS
BUY SIGNAL AND VICE VERSA...
SIMILARLY YOU MAY COMPUTE 15 DAYS SMA AND 34 DAYS SMA....
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