Simple Moving Average (SMA)

SIMPLE Moving AVERAGE
Graphic packages offer a wide variety of ways of times for Simple Moving Average. For example, the user can use it itself or to combine one average sliding line two average Lines in forex trading for creation of signals of crossing the Length of lines can alsoTo differ depending on, whether places swing currency trading or short-term trends. First choice which, however, it is necessary To make - what type of average sliding to apply.

Also let me explain, why. Moving Average is simply average Parameter of a forex market price of closing for chosen time in daily chart or hourly trading chart or 5 minute chart etc...

To construct moving average for 200 days , the computer adds last 200 prices of closing of the given action also divide the sum on 200. Every day the new number to the sum (final price) increases, andThe old number is not taken into account (the price 201 day ago).

As average moves every day, the name simple moving average ). Average for 50 days uses last 50 days, When you are calculating moving average for 10 days, use last 10 days. ItRefers to as simple average as the price of each day has equal weight.

The same fundamental can be applied for hourly chart for forex swing trading or on 5 min/15 min chart for day trading.