Suppose I take a two moving averages to analyse stock market prices - one $200$ day moving average, $m_{200}$, and another $50$ day moving average, $m_{50}$.
How do you decide when to sell and when to buy a stock based on these moving averages so as to maximize your profits? For example what can be deduced when $m_{50} > m_{200}$?
When $m_{50}>m_{200}$, it means that recently the stock has done better than it has done over a longer term. This suggests that the stock is on the rise, and might continue rising; buy. However, take easy rules about stocks with a boulder of salt.