Patience is a virtue that benefits all of us, especially when circumstances require quick decisions. Trading, however, requires patience before circumstances require quick decisions. How quickly you make a decision in the moment of the trade might very well determine success or failure.


When shorting or going long, what timeframe do you use for a long-term trade (1-3 months) once the 20-day moving average has crossed the 50-day moving average (minutes, hourly, daily or weekly)?

Angela from Timing town


Angela, if this question is to me personally, I will tell you first off that I don’t short trades. I believe short selling is bad for all of us, and I hope the new regulations coming down the pike curtail the approach dramatically. Just look what it did to the markets last fall. Huge hedge funds drove the markets down into oblivion.

As well, I am not sure I understand your question, but I will give it a shot.

What I think you are asking is: how long do I want to see the 20-day MA above the 50-day MA before making a trade? Personally, for my trading style, this simple indicator is not enough, but to generally answer your question (relating to me), I will say daily or weekly is important. I look for medium-term (3 days to 1 month) trends, so the moving average cross that holds for days or weeks is best for me.

Now, having said this, I will tell you many traders see this differently (obviously). It simply depends on your own trading style. Day traders will look for shorter-term crosses. Investors and swing traders will look for longer-term crosses.  

Trade in the day; invest in your life …

Trader Ed