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Calculating Moving Average from Close and the Other Methods

Topics: Trading Strategies > Technical Analysis      

The common method: using closing prices Most people calculate moving averages (or let their software calculate it) from the closing price of each bar. This has a valid reason on daily or weekly charts, because the price at which the market closes on a particular trading day or week has a big meaning. Of course, … Read more


The Most Important Parameter for Moving Averages

Topics: Trading Strategies > Technical Analysis      

What a moving average period means The length of a moving average period, or simply moving average period, means how many bars are used for calculating the moving average. When you are selecting a moving average period length, you are deciding how far back to the history you want to look. For example, a simple … Read more


Moving Averages: Choosing the Right Period Length

Topics: Trading Strategies > Technical Analysis      

There is no perfect moving average Like there is no “right” way to do many things in finance and trading, there is also no “right” moving average period. Advantages of faster moving averages Most people who like trading are naturally attracted to tools that seem to work faster and show more action. That’s why we … Read more