DislikedMy suggestion to all Sonicers is to cease and desist in using MAs to "forcast" PA. The Big Guns in the market determine daily what will happen to prices, not MAs! If on any day prices seem to be in accord with MAs, it is not because the MAs made it happen.
We Sonicers use the Dragon MA for nothing else but to ID the proper EP zone, and the angle thereof as an indicator of "possible" momentum that might support a breakout. Sonicers don't use MAs, but the PA itself (!!!) to find appropriate PA Waves to validate a setup!Ignored
An important point you made was not just that MA's are lagging but also that the longer term ones lag just that much more. So while Classic TA has given the name of the 50/200 the "Golden Cross", and the opposite the "Death Cross", it is indeed a very lagging indy but it can still serve the "average non-technical Investor" as a signal that price 'should' continue in the direction signalled until/unless the signal reverses.
For a "Technical Trader", these crosses really are not that useful imho and again I agree with TAH here.
One thing that has not been mentioned is the important difference an EMA has over a regular MA, which is that the most recent price activity is weighted heavier, so they reflect the most recent price action better than a regular MA. They are still lagging, and the longer term ones again still even more so but they do react quicker than their counter parts. (and a reason why the MACD and the Histo, when interpreted correctly and entirely, can be quite useful for tracking momentum and spotting early signs of a possible reversal coming ie divergence etc)
This brings us to the Dragon, which is a fairly short term EMA based "wave" or envelope if you will. One of the main uses for this is 'helping' us to gauge the current direction. This can be done without the Dragon, by following just pure PA but the Dragon gives a nice visual and because it's lagging, I would argue it helps to keep you prematurely entering whipsaws, sideways action and false reversals when used correctly (waiting for the angle). It can also be used to not prematurely exit positions, if so inclined, since price will typically whip around trying to shake you out of any move but generally will continue in it's current direction until the slope of the Dragon changes and price jumps over the Dragon. Price does not reverse because of the Dragon, of course, but the Dragon helps to show true reversals rather than just small retraces in a current move.
So in a sense and more to that end, the Dragon is being used to 'help' predict direction. If the Dragon is pointing down, and price is bouncing up, this is a signal not to go long and vice versa, the Dragon is 'telling you' this bounce is not significant enough to warrant entry. If the Dragon is sideways, this is telling us there is no current direction and not to enter until one has been determined.
In summary, while I agree the big guns drive the markets and decide what is going to happen, and they don't generally care about MA's or EMA's and don't act according to how they are positioned, EMA's can still be used to help guide us and keep us on the right side of the trades.
My 2 coppers.
disclosure, I am a big fan of using EMA's to trend trade and do so on many TF's but it is only one thing I consider