Let us compare the simple moving average vs exponential moving average. Otherwise, the indicator will change its direction only when the price movement is stronger or /and longer. If the current price has more weight, the indicator will faster react to the new information and look more like a zigzag. The current indicator value already includes the current price action, the previous price action, and the importance coefficient. Let us explore what is an exponential moving average in more detail. The pleasant look is important in the Forex market, isn’t it? ![]() What is the exponential moving average? The EMA indicator moving average is somehow more popular than other MA modifications. Exponential Moving Average Indicator (EMA) In the calculations, it has either a greater or lesser value compared to the past data.Įach of these moving averages is used in technical analysis as a trend indicator. Types of Moving AveragesĪll hundreds of thousands of MA versions differ only in relation to the current price. The exponential moving average (EMA) is a moving average analyzing the current price changes and indicating the most recent price moves. For example, in the last 8 hours, in the last 5 days, etc.Ī simple MA wasn’t sufficient for traders, so they invented millions of Moving Average versions that could react to the price changes as fast as possible.
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