The influence of dual moving average crossovers on the investors behavior / Noor Aishah Abdullah

This paper examined the investors behavior which influenced by Dual Moving Average crossovers as one of the technical analysis tools. As these crossovers could give signals for investor to forecast the trends of stock price. This study focused on the Malaysian stock market using the data collected from January 1st 1996 until 1st January 2007. As this study applied the trading rules of Dual Moving Average Crossovers in identifying the signals occurred and also the volume of trading transacted. The independent group t-test, which is one of the T-tests rules applied in this analysis to find out the significant difference between means for the two sets of scores, is significant. The two sets of scores referred to two different groups of investors behavior: conservativeness and representativeness. From the finding, the study identified that the Dual Moving Average crossovers could influence the investors behavior since there were indifferent between these two groups of investors in making their decision whether to buy and sell the stocks. It could be seen from the most powerful confirming indicator of a price move which is volume. From each signal occurred generated by Dual Moving Average Crossovers, volume of the trading were taken to measure the extent of trader participation. The different of volume in each signal interpreted the different behavior of investor. Investor who is accompanied with the signal given referred to representative behavior while investor who is contradicted with the signals given referred to the conservative behavior. Thus from the Dual Moving Average Crossovers trading strategy, it could influence the investor's behavior on making a decision buying or selling the stock.