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Future Trends from Past Cycles: Identifying share price trends and turning points through cycle, channel and probability analysis by Brian Millard

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9. Averages as Proxies for Trends

In this chapter we will build upon the discussion in Chapters 7 and 8. We will do this by applying various centred moving averages to market data and seeing the effect of using different values for the period. When the moving average is plotted as a centred average, as in Figure 9.1, one feature will be obvious. That is the oscillation of the data around the average.

Figure 9.1 – A centred 15-day moving average applied to the Motorola stock price. The price oscillates around the average but remains within certain limits.

In the terms we used in Chapter 7 the centred average represents a trend. From ...

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