Using the Averages Tab

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Using the Averages Tab

Based on the setting of two moving averages, this tab displays lists of shares whose shorter-term moving average has risen above or fallen below their longer-term moving average. The moving averages also appear on the graph to the right.

Use the Average 1 and Average 2 edit boxes to apply one or two moving averages to the price data. If you just want one moving average, simply set one of the averages to 1; this average in effect becomes the price of the share. In the following explanations, whichever average is the lesser of the two is referred to as the shorter moving average, with the other referred to as the longer moving average. As soon as you change an average, the Above and Below list boxes are updated.

Average 1

Enter the number of days over which the first moving average is to be calculated. Either enter the number directly or use the Up/Down arrows to the right to alter the existing value.

Average 2

Enter the number of days over which the second moving average is to be calculated.

Type option buttons

Select whether you want to use Simple or Exponential moving averages. Simple moving averages apply equal weighting to all prices in the specified period, and are therefore slower to react to recent prices changes than exponential moving averages, which apply progressively greater weight to more recent prices.

Crossing in last given number of days

Tick the check box and specify a number in the accompanying box if you only want shares whose averages have crossed in the given number of days to appear in the Above and Below list boxes.

Above list box

Lists shares whose shorter moving average is currently greater than their longer moving average. This may be an indication to buy. If one of the moving averages is set to 1, then this list contains shares whose price is currently greater than the other moving average.

Below list box

Lists shares whose shorter moving average is currently less than their longer moving average. This may be an indication to sell. If one of the moving averages is set to 1, then this list contains shares whose price is currently less than the other moving average.

Both Averages Rising check box

Tick this box if you want the Above list box to show only shares whose averages are both rising, which is often considered to be a stronger buying signal.

Both Averages Falling check box

Tick this box if you want the Below list box to show only shares whose averages are both falling, which is often considered to be a stronger selling signal.