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A moving average (MA) is a trend-following indicator because it is based on past prices. The two basic and commonly used MAs are the simple moving average which is the simple average of a security over a defined number of time periods, and the exponential moving average which gives bigger weight to more recent prices. The most common applications of MAs are to identify the trend direction and to determine support and resistance levels.
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Moving average is a technical indicator used to identify the trend direction and to indicate the support and resistance levels.
This is more accurate and useful during a trending phase.
Moving average is the average of the past closing prices. It is used as a technical indicator.
It is widely used indicator for trending zones .
When prices go above MA – Bullish trend (buy) ; When it goes below MA – Bearish trend (short sell ).
But it not efficient for sideways movement.
It is an average of all the past day prices using which one can identify which trend is dominating
moving average is a tool for identify the trend but it is not a decision making tool
it shows a clear diagram of the price and help to identify bullish or bearish trend some times it may be correct or wrong
we can take 21 days in moving average to calculate the trend it is performed in trend zone
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