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Understanding the terms 50 DMA and 100 DMA

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Moving averages are important technical indicators that every investor should know. A breakdown of a stock price below these levels is seen as a weakish trend for a stock or the index as the case maybe.

 

Understanding the terms 50 DMA and 100 DMA
How do 50 DMA AND 100 DMA Work?

DMA is also called daily moving averages. So, a 50 DMA means the average closing price of a stock for the last 50 days. On the other hand a 100 DMA means the daily average price for the last 100 days.

Both these are important indicators when determining the movement of a stock. Technical analysts use this very frequently.

Fundamental analysts on the other hand care very little for the moving averages. Their stocks picks are more based on the fundamental analysis of a stock more than anything else.

They might tend to ignore technical analysis altogether.

GoodReturns.in

Read more about: dma
Story first published: Saturday, May 23, 2015, 10:42 [IST]
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