A line on a price chart that smooths historical prices over a defined period to show the prevailing trend direction.
Simple moving averages (SMA) weight all periods equally; exponential moving averages (EMA) weight recent prices more heavily and react faster. Common periods are 20, 50, and 200 sessions.
Moving averages serve as dynamic support/resistance and are used in crossover strategies: a faster MA crossing above a slower MA signals a potential uptrend, and vice versa. They lag price by nature, so are better suited to trend confirmation than entry timing.
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