Letters to S&C by Technical Analysis
SMILES AND FROWNS
I enjoyed Tom Bulkowski’s article
“Trading Smiles And Frowns” (S&C,
October 2013). I am uncertain of why he
offset the 50-day moving average by 25
days. Could you explain why and also,
what is meant by the term offset? If this
explanation lies in one of Bulkowski’s
books, I would look to that.
Author Tom Bulkowski replies:
This concept is discussed further in my
book Swing And Day Trading: Evolution
Of A Trader (Wiley Trading). Using
a moving average helps you visualize
the smile or frown. It has no trading
As my October 2013 S&C article
explains, you can push (offset) the moving
average to the left to help line it up
with price so that the smile or frown
becomes obvious. To do this, use half
the wavelength of the moving average.
For example, if you’re using a 200-day
moving average, then you would push
it to the left by half that amount, or 100
days. That “offset” will properly line it
up with price.
KEEP YOUR PORTFOLIO SAFE
Azeez Mustapha’s August 2013 S&C
article “Keep Your Portfolio Safe” has
many gems of wisdom. It’s worth reading
again and again.