TradingMarkets Rule 3 - Buy Stocks Above Their 200-day MA

There's a well known saying that the trend is your friend. And this saying is very true. The market behaves better above its 200 day moving average than below it. And the average gain of the market is far greater when prices have been above the 200 day moving average than when it has been below it.

This rule is not fool-proof. Many good value stocks represent real value below the 200 day ma. But as a whole, without adding any other filters, it's easier to make money when buying the market and stocks when the trend is up, not down.

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