Applying Wave-Theory Timing and Moving-Average Systems in Forex Trading

In the process of Forex speculation, the wave theory is one of the commonly used analysis methods for Forex traders. The precept that waves have no timeliness stipulates that no matter how long a wave runs, it will run in its own form. Time is the interval and cycle of changes in things. Without time, things cannot move, and everything in the world is in motion, and waves are exactly the form of trend movement. Without time, how can there be movement? Without time, it is obviously impossible to distinguish things, and therefore market trends, and how to distinguish waves.

The wave theory places great emphasis on cycles. Time is the mark of the celestial body cycle. The earth's orbit around the sun is one year, the moon's orbit around the earth is one month, and the earth's rotation is one day. One day is divided into 24 hours, that is, every 15 degrees of rotation is one hour. This is a truth that even primary school students know - time is the cycle of celestial bodies. And again and again, the cycle of a wave happens to be the repetition of an approximate form in an approximate time interval. The soul of the cycle is time. Without time, how to calculate the cycle and what is the basis for calculating the cycle? Waves have no time. The contradiction with the wave theory's emphasis on cycle is another major contradiction of the wave theory.

The moving average, also called the moving average, is a common analysis tool in technical analysis. When used, it is often combined with the candlestick to judge trends and technical forms. The calculation of the moving average is the arithmetic mean of the closing price and closing point within a period of time. The connection of consecutive averages forms the moving average.

In terms of the use of moving average systems, they are mainly divided into the following categories:

The first is the trend. The short-term moving average is upward, indicating that the stock or index is in an upward trend in the short term. Similarly, the medium-term moving average and the long-term moving average are upward, which reflects the medium- and long-term upward trend. If it is not upward, but downward, it shows a downward trend. If the slope of the moving average is not large, it is in a downward trend. Horizontal operation indicates a consolidation pattern. In a sustained long-term uptrend, the short-term average is generally at the top, the mid-term average is in the middle, and the long-term average is below. In a sustained long-term downtrend, the short-term average is generally at the bottom, the mid-term average is in the middle, and the long-term average is above.

The second is crossover breakthrough. We can judge the possible breakthrough trend of individual stocks or the market from the crossover of the moving average system.

The third is the divergence pattern. Divergence refers to the increasing distance between the short-term, mid-term and long-term moving averages. Especially the short-term moving average tends to move very steeply at this time, that is, the slope is very large. If it is an upward trend, it means that the short-term cost is much higher than the medium-term and long-term costs. The profit chips increase greatly, and the short-term pressure to cash out is faced.