new world, page-10

Hi Tradingfeak

The 200 day MA is a very long term indicator of the long-term health of a stock. Now if you use this indicator AFTER we have had the world markets thrashed by one of the biggest finanacial crisis' the world has ever known, you will have a few problems!

For example, try a 200 day MA on ANZ, BHP, LEI, AMP, NAB, IPL, WES, etc etc ... what do you get? Well they are ALL trending down!

Professional investors usually use the 200 day moving average in conjunction with the 50 day moving average. Then they look for buy & sell indicators as these cross over, or as the SP approches or moves away.

If you are going to just use it as a trend indicator, well fine, but the 200 day MA is like a supertanker that takes ages to turn around. So if you have to wait for it to trend upwards before you buy in, the SP will be around $1.70 and you will have missed the boat.

Some shorter term indicators might be the way to go now so that you can spot some of the recovery plays around. Really, this market can be as good as a bull market in may ways:

BMN has gone from 22 cents to 67 cents in a few weeks ... 200% gain
BBI has gone from 2.2 cents to 11 cents in 5 days ... 500% gain

Many others around to, even in the blue chips offering around 50% - 100% gains. Some great opportunities soon in the uranium sector too.

all the best

TB