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The first concept is called the extendedness of price action. And this has many different implications of how you can use this concept. There are many ways how you can use that. First of all, the most obvious one is that whenever you see that the price action is very far from your central moving average, it means the price is very overextended. Some people may even say that it is oversold or overbought in this case. And the most obvious use cases that you are trading the price action back to the moving average. And this is especially helpful in Forex trading because Forex trading is a mean-reverting market in contrast to stocks, which is generally considered a trending market in Forex. It is much, much more common to see the price fluctuate around a mean, and I use the 50-period moving average. And as an example you can use any moving...
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