Simple vs Exponential Moving Average
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Simple vs Exponential Moving Average
- 1. The Academy of Financial Trading Simple vs Exponential Moving Average www.academyft.comsupport@academyft.com
- 2. SMA vs EMA explained Any Advice or information provided by the Academy of Financial Trading is General Advice Only - It does not take into account your personal circumstances, please do not trade or invest based solely on this information. By viewing any material provided by the Academy of Financial Trading or using any information or tools you agree that this is general educational material and you will not hold any person or entity responsible for loss or damages resulting from the content or general advice provided here by The Academy of Financial Trading, its employees, directors or fellow members. Futures, Contracts for Difference (CFDs), Options, and spot currency trading have large potential rewards, but also large potential risks. You must be aware of the risks and be willing to accept them in order to invest in CFDs and leveraged forex markets. Don't trade with money you can't afford to lose. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in any material provided by the Academy of Financial Trading. The past performance of any trading system or methodology is not necessarily indicative of future results. Risk Warning
- 3. Simple vs Exponential – what’s the big deal? The Simple is the most commonly used retail indicator Simple vs Exponential Moving Average The exponential is often used among the more advanced trader – it’s roots are somewhat different from the SMA Both are often used as indications of momentum in a market They are seen as a ‘lagging’ indicator – so their respective signals are seen to be delayed SMA vs EMA explained Let us explore both separately
- 4. The Simple Moving Average We simply take the price over the last given period and then sum to give us the current value of the SMA This will then give us the current value of the SMA SMA vs EMA explained Simple vs Exponential Moving Average Let’s work through some examples
- 5. The Exponential Moving Average The Exponential Moving Average is used to capture smaller term trends Given how the EMA is used we can deduce quickly that it is employed by those looking to capture smaller term trends One might say it has an accelerated reaction to the most recent price – so it let’s us react that little bit quicker Both are comparable in this sense and we can use a combination of the two for the purposes of confirmation on a signal. Let’s see what they look like in reality SMA vs EMA explained Simple vs Exponential Moving Average The EMA takes into account the most recent price more so than the SMA – so it is more sensitive and adjust quicker
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Editor's Notes
- Refer to education – how to fund the same and find the same and refer to a job, training and the necessary efforts one has to make to understand the same. Also refer to Google here and how PS ratio Doesn’t indicate large patterns over time and maybe only intraday opportunities