Tech Analysis To Identify Trend Using Exponential Moving Average - EMA 📈 Day 3 (AMC As Example)

Previous posts:
Milk The Cow :Tech Analysis To Identify Trend Using Moving Average - MA 📈 Day 1 (AMC As Example)

Milk The Cow :Tech Analysis To Identify Trend Using MACD 📈 Day 2 (AMC As Example)

What is Exponential Moving Average (EMA)?
It's a type of Weighted Moving Average (WMA) that gives more weighting or importance to recent price data.

EMA is something like the modified version of Simple Moving Average (SMA).

FORMULA:
EMA=Price(t)×k+EMA(y)×(1−k)
where:
t=today
y=yesterday
N=number of days in EMA
k=2÷(N+1)

Blah blah blah... =
Hmm... , very chim (profound) eh...
As mentioned is my previous post (Day 2), u does not require to know the calculation to use EMA as moomoo apps has already done those for us.
Though it's good to know for knowledge.
(I read the formula before in the past, but already forgotten )

Source:
Investopedia - EMA

So how we use EMA on stocks?
Check out @Meta Moo post first:
Meta Moo :Technical Analysis Challenge Day 3 - EMA
(He getting better & better in the explanation
)

Tips:
EMA is usually use for a short term price movements prediction as it's one of the better indicator for it.

EMA is designed to see price trends over specific time frames, such as 50 or 200 days.

Ok, enough of blah blah blah...
Time to apply EMA on $AMC Entertainment(AMC.US)$ as an example.

P1:
(Let's use the 50 & 200 days time frames.
To do that, let's change the EMA setting in which I'd mentioned the ways in the previous post [Day 1] )

Tech Analysis To Identify Trend Using Exponential Moving Average - EMA 📈 Day 3 (AMC As Example)

P2:
(We do not need so many EMAs = Just tick 2 of them as shown below the picture... the rests are just temporary junks.)
Inputs:
EMA1 = 50
EMA2 = 200

P3:
(Now, what we all are waiting for...
AMC! yay!!!)

Orange curve = EMA1
Blue curve = EMA2
EMA1 > EMA2 = Possible up trend
(Green circling)
Note:
EMA1 intercepts EMA2 = Signal "Buy" for P3

P4:
(Let's look at the vi-versa of EMA)

EMA1 < EMA2 = Possible down trend
(Yellow circling)
Note:
EMA1 intercepts EMA2 = Signal "Sell" for P4

P5:
WAIT✋!
    .
    .
    .
    .
    .
Is there even one?
Just giving a piece of tip as fellow investors:
If u are a long-term stock holder & u are confident with ur calculations of valuation, short-term time frame indicators may not be suitable for u

As always, DYODD first before investing

Edited:
Next update of posts sequence (event):
Milk The Cow :Tech Analysis To Identify Trend Using Directional Movement Index - DMI 📈 Day 4 (AMC A...

Milk The Cow :How to use KDJ for short-term trading, TA Challenge🤔?

Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only. Read more