More Related Content
More from RajaKrishnan M
Moving average
- 1. MOVING AVERAGE 1 Rajakrishnan M AssistantProfessor in Commerce CA Fundamental and Technical Analysis
- 2. MOVING AVERAGE Dr. N.G.P.Arts and Science College Coimbatore, Tamil Nadu, India 2 A moving average is a technical indicator that combines price points of an instrument over a specified time frame, and divides by the number of data points, to give you a single trend line. It is popular amongst traders because it can help to determine the direction of the current trend, while lessening the impact of random price spikes.
- 3. MOVING AVERAGE Dr. N.G.P.Arts and Science College Coimbatore, Tamil Nadu, India 3 SIMPLE MOVING AVERAGE EXPONENTIAL MOVING AVERAGE
- 4. SMA Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 4 The simple moving average (SMA) calculates an average of the last n prices, Simple moving average = (P1 + P2 + P3 + P4 + ... + Pn) / n
- 5. SMA Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 5 A simple moving average (SMA) is the most basic MA, which is just a straight calculation of the mean price of a set of values over a given time periods If you were to calculate the SMA for a ten-day period, you would take the values of the last ten days and divide the result by ten.
- 6. SMA Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 6 Popular moving averages used by most traders are the 10, 20, 50, 100 and 200
- 7. SMA – 10,20 and 50 Dr. N.G.P. Arts and Science College Coimbatore, Tamil Nadu, India 7
- 8. EMA Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 8 The key difference between a simple moving average (SMA) and the exponential moving average (EMA) is that in the EMA calculation, the most recent data is weighted to have more of an impact.
- 9. EMA Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 9 The direction of the moving average conveys important information about prices, whether that average is simple or exponential. A rising moving average shows that prices are generally increasing. A falling moving average indicates that prices, on average, are falling. A rising long-term moving average reflects a long-term uptrend. A falling long-term moving average reflects a long-term downtrend.
- 10. EMA Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 10 For analysis, all the moving averages help highlight the trend. When the price is above its moving average, it shows that the price is trading higher than it has, on average, over the period being analyzed. That helps confirm an uptrend.
- 11. EMA Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 11 When the price sits below its moving average, this shows that the price is trading lower than it has, on average, over the period being analyzed. That helps confirm a downtrend.
- 12. SMA (100 and200) NIFTY Dr. N.G.P. Arts and Science College Coimbatore, Tamil Nadu, India 12
- 13. MA CROSS OVER Dr.N.G.P. Arts and Science College Coimbatore, Tamil Nadu, India 13 When the price crosses above its moving average, this shows the price is getting stronger relative to where it was in the past because the most recent price now sits higher than the average. If the price crosses below its moving average, it shows the price is getting weaker relative to where it was in the past.
- 14. MA CROSS OVER Dr.N.G.P. Arts and Science College Coimbatore, Tamil Nadu, India 14
- 15. MA CROSS OVER Dr.N.G.P. Arts and Science College Coimbatore, Tamil Nadu, India 15 A buy signal is generated when the short-term SMA crosses above the long-term average from below. While a sell signal is triggered when the short-term average crosses below the long-term average from above.
- 16. MA CROSS OVER(Red ST 10 & Blue LT 20 ) Dr. N.G.P. Arts and Science College Coimbatore, Tamil Nadu, India 16
- 17. CONSOLIDATION Dr. N.G.P. Artsand Science College Coimbatore, Tamil Nadu, India 17
- 18.