These PMAs are important components of Mark Fisher's ACD strategy. It is the fourth layer of his strategy. Also, We can use it for all MA-based strategies. Because it is based on Moving-average.
The PMA is a set of 3 EMAs on HLC3 data. Columns turn green when the MA1-period moving average is above the MA2-period moving average, and the MA2-period moving average is above the MA3-period moving average and all MAs are rising. If all three degrees of the trend are positive, the trend is up, and we can more confidently enter on the long side by confirming our trading system.
Columns turn red when the MA1-period moving average is below the MA2-period moving average and the MA2-period moving average is below the MA3-period moving average and all MAs are falling. If all three degrees of the trend are negative, the trend is a downside, and we can enter on the short side by confirming our trading system.
The columns turn yellow when the three moving averages are not in the two ways mentioned above, it is a sign of weakness and side market. In this situation, because the direction of the market is not yet clear, we do not have an entry and we wait.
The PMA is a set of 3 EMAs on HLC3 data. Columns turn green when the MA1-period moving average is above the MA2-period moving average, and the MA2-period moving average is above the MA3-period moving average and all MAs are rising. If all three degrees of the trend are positive, the trend is up, and we can more confidently enter on the long side by confirming our trading system.
Columns turn red when the MA1-period moving average is below the MA2-period moving average and the MA2-period moving average is below the MA3-period moving average and all MAs are falling. If all three degrees of the trend are negative, the trend is a downside, and we can enter on the short side by confirming our trading system.
The columns turn yellow when the three moving averages are not in the two ways mentioned above, it is a sign of weakness and side market. In this situation, because the direction of the market is not yet clear, we do not have an entry and we wait.