What is Moving Average?

[Ajai Kamath]

Moving average is a widely used trend indicator by technical analyst as a live readymade analysis. Moving average works better trending region, whereas it confusing during non trending region. The place where price goes below the moving average can be indicated as bearish trend and above is bullish trend.

[Pradeep Nadarajan]

Moving average is used for a span of 21 days.

Bull is expected if price movement is above average

Bear is expected if price movement is below average.

Moving average works in trending zones.

[Ubeidulla]

Moving Average is a technical indicator used to help in analyzing stocks and forecast their trend.

Moving Average is the averages of all the prices in a particular term. If we draw an ‘average’ line, it would follow the price line but would be a much smoother curve. With this ‘average’ line we can come to some conclusions.

If the price line (stock price) is above the ‘average’ line the trend is bullish and if the price line is below the ‘average’ line the trend is bearish. This technical indicator works during trending time and is not helpful during sideways or non trending times.

As the stock prices do have a fairy erratic nature they will go up and down, as in repel away and attract toward the ‘average’ line. So we can consider this a magnet line, which help us in making more informed decisions. As an example, probably, during a bullish trend, if the stock prices do fall below the ‘average’ line, it is a good time to sell.

[Manikandan]

average price calculated for past 20 days to check bullish or bearish trend.

[Livya]

It is a technical indicator for trending period. It helps to determine bullish and bearish trend based on the average price of 21 days.

[Author]

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