Moving Average
Trend Indicator
Moving Average
A Moving Average smooths out price data by creating a constantly updated average price.
Overview
The Moving Average (MA) is one of the most widely used technical indicators. It helps identify trends by smoothing out price fluctuations. When the price is above the MA, it suggests an uptrend; when below, it suggests a downtrend.
Use Case
Best used for identifying trend direction and potential support/resistance levels.
Calculation
Simple Moving Average (SMA) = Sum of closing prices over N periods / N