TECH TALK TUESDAY
OCT 8, 2019
Red in this chart is the 50 day simple moving average. Blue on this chart is a 20 day simple moving average. I call this a Double Crescent Formation. This is an example of a “price” set up, with the two moving averages in upturning crescents. On-Balance-Volume in this set up is not optimal. Optimum for OBV would be if it was turning up in the same measure as the Blue line, the 20 day simple moving average. A note here is that JE often moves counter cyclically but with weak cycles, so at times it may not react as in an optimum “set-up”, but I liked the Double Crescent Formation to illustrate.
This is not a recommendation, but an illustration, to help you recognize this kind of set up when you run across it. We will discuss other types of set-ups and where to look for them in future posts. Good Luck, DG