Moving average crosses are one of the best ways to use moving averages. Using a moving average cross strategy requires that you use two moving averages, one fast, and one slow.
Showing posts with label Moving Averages. Show all posts
Showing posts with label Moving Averages. Show all posts
Simple vs. Exponential: A Comparison
In looking at the two types of moving averages, you can come to a very simple conclusion: use what works best for you. Each can be used to produce successful trades, and some traders even use both!
Exponential Moving Average
The exponential average is a variant of the moving average. In an exponential moving average, the price action in the most recent trading periods has more weight in the calculation.
Simple Moving Averages
The simple moving average is one of the most primitive trading tools investors have at their disposal. Used for many decades in regulating the price of every financial instrument over time, the simple moving average is used to show how the current price of a currency relates to the average price during the previous X periods.
Moving Averages
Moving averages lay the basis for our study in technical analysis indicators. Moving averages are the most simplistic form of an indicator as they use the past prices of a currency pair to help traders see the future direction of a currency pair.
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