Moving Averages
A moving average is a calculation that takes the average closing price of an asset over a specified number of periods and updates it continuously. Common moving averages include the 20, 50, 100, and 200-period simple moving average (SMA) and exponential moving average (EMA).
Why it matters for traders
Moving averages are among the most widely used indicators for identifying trend direction, dynamic support and resistance levels, and potential reversal areas. They are often used to define trend in trading strategies.
How Tradapt tracks this
Tradapt's Backtest tool lets you test moving average crossover strategies on historical data. Tag trades taken at moving average support in your Playbook to track their specific win rate.
Track this free in TradaptFrequently asked questions
What is the best moving average for trading?
There is no universally 'best' moving average. The 20 EMA is popular for short-term trading; the 50 and 200 SMAs are widely used for trend definition. The best approach is to test specific moving averages in your trading instrument and timeframe using historical data.