The 9ema on the 5m chart is a very popular moving average that many people use which is why it acts as support a lot, especially the first few minutes of the day during a morning spike when there are no pullbacks/support levels to judge from. During a morning spike I use the 9ema to judge if a stock is overextended and if it is I usually wait for a pullback to the 9ema before getting in. This is the logic most people use. However, horizontal lines for support and resistance are always better. In
Lieu of these when they're not available then yes the 9ema also serves as an effective stop. However I like to set my stop as the first candle to make a new low on the 5 min chart. Take a look at PULM this morning. The first red candle made a new low compared to the candle before it and I would have stopped out there. If I had waited for the 9ema then I wouldve lost out on a little bit of profit
The 9ema on the 5m chart is a very popular moving average that many people use which is why it acts as support a lot, especially the first few minutes of the day during a morning spike when there are no pullbacks/support levels to judge from. During a morning spike I use the 9ema to judge if a stock is overextended and if it is I usually wait for a pullback to the 9ema before getting in. This is the logic most people use. However, horizontal lines for support and resistance are always better. In
Lieu of these when they're not available then yes the 9ema also serves as an effective stop. However I like to set my stop as the first candle to make a new low on the 5 min chart. Take a look at PULM this morning. The first red candle made a new low compared to the candle before it and I would have stopped out there. If I had waited for the 9ema then I wouldve lost out on a little bit of profit
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