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What
are the
Moving Averages Components of a Stock
Configuration?
Answer:
A Stock Configuration consists of four Components, as follows:
-
Price of
the Stock - as of the most recent Friday's close;
-
5
week Moving Average of the subject Stock’s weekly closing price
– utilized to monitor short-term movement of the Stock;
-
15 week Moving Average of the subject
Stock’s weekly closing price –
utilized to monitor intermediate-term movement of the Stock;
-
40
week Moving Average of the subject Stock’s weekly closing price
– utilized to monitor long-term movement of the Stock.
The most important things to know about the four Components are:
-
rank
- the value of each Component in
relation to the value of the other three Components (i.e., which
Component's value is Highest,
Center, or Lowest, etc...),
and
-
direction
- whether each Component moved UP or DOWN (increased or decreased in
value) in relation to where it was the previous week.
So, as an example looking at
the hypothetical “ABC Stock”, if the . . .
-
ABC
Close was at $24.00 the previous week and is at
$27.00 for this week (i.e., it is the HIGHEST of the stock’s Components and it moved UP), and the
-
ABC
5wk was at $21.80
the previous week and is at $23.30 for this week (i.e., it is the LOW-CENTER
of the stock’s Components and it moved UP), and the
-
ABC
15wk was at
$24.60 the previous week and is at $23.10 for this week (i.e., it is the
LOWEST of the stock’s Components and it moved DOWN), and the
-
ABC
40wk was at
$26.20 the previous week and is at $25.00 for this week (i.e., it is the
HIGH-CENTER of the stock’s Components and it moved DOWN),
. . . then the ABC Stock
Configuration for this week would look like this:
|
Current ABC Stock Configuration |
ABC Close - UP
ABC 40wk - DOWN
ABC 5wk - UP
ABC 15wk - DOWN |
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