Chapter 14. Moving Averages
Chapter Objectives
By the end of this chapter, you should
• Be aware of how moving averages are used to identify trends
• Be able to calculate a simple moving average
• Be able to calculate an exponential moving average
• Be familiar with the concept of directional movement
• Be familiar with the construction of envelopes, bands, and price channels
One of the most successful methods of identifying and profiting from trends is the use of moving averages. A moving average is a constant period average, usually of prices, that is calculated for each successive chart period interval. The result, when plotted on a price chart, shows a smooth line representing the successive, average prices. Moving averages dampen the ...
Get Technical Analysis Trading Methods and Techniques (Collection) now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.