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What does moving average bonding mean?
Average adhesion is a concept in technical analysis. The moving average is the average of stock prices. Using the moving average, we can clearly understand the current stock price trend and predict the future price trend. When two or more moving averages are close to each other on the price chart, it is called bonding. The phenomenon of moving average adhesion usually occurs when the upward trend and the downward trend alternate, which is an important method to judge the reversal signal. The closer the EMA is, the smoother the fluctuation of stock price in a period of time, and the greater the distance between EMAs, the greater the fluctuation of stock price.

Moving average bonding is usually used to predict the turning point of short-term trends and is an important operational strategy. When there is a trend of moving average bonding, if the price breaks through the moving average, it means a turning point in the short-term trend, and investors can use this signal to judge admission and exit. If the price falls below the moving average, it means that the current trend is downward and should be sold or left. If the price goes above the moving average, it means that the current trend is upward, and you can buy or add positions at this time. It should be noted that the signal generated by EMA bonding can only be used for short-term trading strategies, and the long-term trend is not affected by EMA bonding.

Although moving average bonding is a reliable short-term trading strategy, it is not suitable for all markets and all time periods. Especially when the market is in a volatile market and the price fluctuation is small, the effect of moving average bonding may be very insignificant, and the trading decisions made from it may also end in failure. In addition, if we only rely on the adhesion form of the moving average without combining other technical analysis indicators to judge the trend, the risk will also increase. In short, investors need to rationally treat EMA bonding as an auxiliary tool, not the only decision-making factor.