These Signals are long term trend following and watched by most market technicians. You may also sign up for our Free Weekly Commentary at the top right of our home page at www.seleznovcapitaladvisors.com
The Golden Cross or Death Cross occurs when the 50 Day Moving Average crosses the 200 Day Moving Average. When the 50 Day Moving Average is crossing from below the 200, it is called “Golden Cross”. When the 50 Day Moving average crosses from above to below the 200 Day Moving Average it is called the “Death Cross”. This system is a very long term trading system and is often very late on entry and exit. It does have a fairly good track record with many Indexes and other assets. It makes very few trades as compared to shorter term moving averages like the 50 Day Moving Average system. It can produce disastrous results if used for every stock index, ETF, or stock.
Other widely followed moving averages are the 50 day moving average and the 100 day moving average. Some money managers will use these moving averages with a shorter moving average and use the cross of the shorter moving average above or below the longer moving average to generate trading signals. The Wall Street Journal displays a 65 Day Moving Average in their charts. The goal of two moving averages and even 3 moving averages is to eliminate whipsaws that often occur with moving averages as a technical analysis indicator.
Why should you care about the signals produced with the 50-200 day moving average? There are so many people using the 50-200 day moving average, that we will often see extreme volatility in indexes when they cross both above and below the 50-200 day moving average.
The table below shows the current 50-200 day simple moving average condition on the 50 most actively traded ETF’s.
|Barclays High Yield Bond||Stay Short||JNK|
|BRIC IShares||Stay Short||BKF|
|Coal Power Shares||Stay Short||PKOL|
|DB Commodity Index||Stay Long||DBC|
|Diamond Trust DOW||Stay Long||DIA|
|Energy Select SPDR||Stay Long||XLE|
|Internet Holders||Stay Long||HHH|
|IPath India Index||Stay Short||INP|
|IShare Russell 2000||Stay Long||IWM|
|IShares 25 Index||Stay Short||FXI|
|IShares Australia||Stay Long||EWA|
|IShares Basic Materials||Stay Long||IYM|
|IShares DJ Real Estate||Stay Long||IYR|
|Ishares DJ Transportation||Stay Long||IYT|
|Ishares Emerging Markets||Stay Long||EEM|
|IShares Financial Sector||Stay Short||IYF|
|IShares Germany||Stay Long||EWG|
|IShares Hong Kong||Stay Short||EWH|
|IShares Latin America||Stay Short||ILF|
|IShares Mexico||Stay Long||EWW|
|IShares Mid Cap 400||Stay Long||IJH|
|IShares MSCI EAFE||Stay Long||EFA|
|IShares MSCI Japan||Stay Short||EWJ|
|IShares Pacific ex Japan||Stay Long||EPP|
|IShares S&P 500 Growth||Stay Long||IVW|
|Ishares S&P Small Cap 600||Stay Long||IJR|
|IShares Silver||Stay Long||SLV|
|IShares South Africa||Stay Long||EZA|
|IShares South Korea||Stay Long||EWY|
|IShares Taiwan||Stay Long||EWT|
|IShares United Kingdom||Stay Long||EWU|
|NDX 100||Stay Long||QQQ.O|
|Oil Service Holders||Stay Long||OIH|
|Pharmaceutical Holders||Stay Long||PPH|
|PowerShares US Dollar Index||Stay Short||UUP|
|RYDEX S&P 500 Equal Weight||Stay Long||RSP|
|S&P 500||Stay Long||SPY|
|Semiconductor Holders||Stay Long||SMH|
|SPDR Consumer Descretionary||Stay Long||XLY|
|SPDR Consumer Staples||Stay Long||XLP|
|SPDR Gold Shares||Stay Long||GLD|
|SPDR Healthcare||Stay Long||XLV|
|SPDR Industrial Sector||Stay Long||XLI|
|SPDR International Real Estate||Stay Long||RWX|
|SPDR Materials||Stay Long||XLB|
|SPDR Metal & Mining||Stay Long||XME|
|SPDR Mid Cap||Stay Long||MDY|
|SPDR S&P Homebuilders||Stay Long||XHB|
|SPDR Technology||Stay Long||XLK|
|Steel Market Vector||Stay Short||SLX|
|US Oil||Stay Long||USO|
|Wisdom Tree Total Dividend||Stay Long||DTD|
You should not trade any system trading plan without proper back testing and analysis of the trading characteristics of the index, stock or ETF you are trading.
These trading signals are provided courtesy of the website you are viewing. This information should not be used without research and advice from a financial professional.
Be aware that this condition can and will change any day in the future.
We monitor the 50-200 day moving cross system daily along with a number of other system trading plans.
There is No “Holy Grail” in trading systems. Do not use the 50-200 day SMA or any other system trading system without proper research on the asset.
For questions on rule based, system trading, contact