Yesterday we noted that the 10 and 21 day moving averages were set to cross bullishly. Today they have.
We have the same set up (just reversed) in the dollar index, where the 10 and 21 day averages crossed bearishly. Trend followers tend to follow react to theses sorts of signals.
The signals are occasionally false, but they can put you into a trend and keep you in a tend for quite a while, if followed religiously…You never get the tops or the bottoms of the trend, but you can sometimes catch the “belly” of the trend.
As Bernard Baruch is reputed to have said “Leave the last 10% for the other guy…”
