All About Moving Average Indicators

Moving averages indicator is widely traded in foreign exchange market. There are so many forex traders in the online market are using this simple trend indicator as a tool of their trading system, because this technical indicator can gives simple and accurate trading signal. In this blog we give the most famous of forex trading indicator that we use to determine the market price movements in the foreign exchange market such as Simple moving average indicator, Exponential moving average, Bollinger bands indicator, stochastic oscillator, Relative strength index, Moving average convergence divergence MACD indicator, Commodity channel index and fibonacci lines. But you must bare in your mind that all of these technical indicator is not exclusive and no one forex indicator is everything.

The main purpose of this post is to give tips of forex trading tools that is already available. Identify the market price action is the important thing that you should keep if you want to learn how to trade with this trend indicator more accurately.

Moving Average indicator as trend trading indicator

The easiest technique to determine a market price level is by determine at the certain price compared with previous price levels. This technique can be done by calculating average formula with Simple moving average indicator.

The SMA Simple moving average indicator is made by calculation of the closing price of the foreign exchange pairs and then the result is divided by the number of the closing price. For instance, when we have 10 days Simple moving average indicator so it mean you calculate the closing prices of 10 periods and then divided the result by 10. For every new closing prices that we calculate the oldest data will out.

Every forex technical indicator has its advantages and also disadvantages, just like SMA Simple moving average indicator. This indicator is the lag forex indicator, it means this indicator moves behind after the current time. And also this trend trading indicator needs big price fluctuations with a lot of times before. With this I think you will get a description about this indicator about where the current market prices relative to the market trend.

Here are how to read SMA forex indicator.

When the market prices move above the Simple moving average then we can assume that the market price is in a bullish trend and when the market prices move below the simple moving average indicator then we can assume that the market price is in bearish trend. This trading method is very simple and easy to understand.

EMA Exponential Moving Average Indicator

This trend indicator acts as the Simple moving average SMA indicator. But the different between EMA exponential moving average and Simple moving average is the EMA gives bigger weight to the newest period. The method behind this EMA Exponential moving average indicator is the more recent market price fluctuation the more relevant it is for the identify the next price.

In other words the Exponential moving average indicator trading indicator gives trading signals more quicker to newest market price changes than Simple moving average SMA indicator, but the mistake rate is bigger than SMA indicator. When the market price moves within a certain range up and down or sideways then the error rate of this indicator is more bigger.

You can also use 2 or more moving average, when the smaller period moving average trend indicator crosses the bigger period moving average from above then we can assume the market price is in bullish trend and we can open buy trading position. And when the smaller period moving average trend indicator crosses the smaller period moving average from below then we can assume the market price is in bearish trend.

Moving average indicator is the forex technical indicator which show the average price in certain period of time. We can arrange our own moving average period such as 12 period moving average, 14, 50, or even 200 days period moving average. When we open 1 hour chart and use 12 period moving average indicator then it means the average prices of last 12 hours is show by moving average indicator. The market data prices that we used for moving average calculation can be variety, you can use open, high, low, and close data price. For example, when we attached moving average 12 period and setting the indicator to closing data, that is mean we use last 12 period of closing data.

In forex technical analysis, everything is just calculation. The market price movements from the previous data are calculated and formulated in one or more formulas. As a result, we will find a line in our trading chart that will show us trading signals, for instance, when a market price value is in a bullish trend, then this indicator line can also show the same. The term for this calculation formulas means technical indicators. The most popular and the easiest forex technical indicator is moving average or MA.

Let me explain about moving average indicator. What is an average? here is the example, when we drink 3 cups of water today, tomorrow you drink 2 cups and the day after tomorrow 4 cups, then you have been drinking an average of 3 cups. 3 cups plus 2 cups plus 4 cups is equal to 10 cups. The whole divided by three days and gives 3 cups of water per day.
Simple right?

Moving average is a trend following indicator which most generally traded by foreign exchange traders. Generally, most forex traders use this indicator in the trading course and they forex trading system. Moving average indicator not just show reliable market trend, but this indicator also used to identify support and resistance levels in all forex trading pairs. Moving average is a line indicator showing the average of the market price movement and smooth it. The calculation of this indicator is based on number of market prices in certain period of time.

Here are moving average custom indicators
1. OsMA.mq4
2. AMA.mq4
3. BandsLSMA.mq4
4. EMA_Trend_Indicator.mq4
5. #MAMA.mq4
6. Carter MA.mq4
7. AMA STL.mq4
8. ZeroLAG MA.mq4
9. i-AMA-Optimum.mq4
10. i-AMMA.mq4
11. 3 MA Cross w_Alert v2.mq4
12. Firebird HMA [i].mq4
13. EMAAngleZero.mq4
14. FX_FISH_2MA.mq4
15. MA_ALERT.mq4
16. MA in Color.mq4
17. EMAOsMA.mq4
18. LSMA_Line.mq4
19. JMA_StarLight.mq4
20. GMMA Short.mq4
21. 4MAs Trend.mq4
22. iMACross.mq4
23. NRMA.mq4
24. FRAMA.mq4
25. AMA optimized.mq4
26. simply_ma_wrong_145.mq4
27. TEMA.mq4
28. DEMA_RLH.mq4
29. LSMA_AppliedPrice1.mq4
30. 4PMA.mq4