Technical analysis has been around for decades and through the years, traders have seen the invention of hundreds of indicators. While some technical indicators are more popular than others, few have proved to be as objective, reliable and useful as the moving average.
Moving averages come in various forms, but their underlying purpose remains the same: to help technical traders track the trends of financial assets by smoothing out the day-to-day price fluctuations, or noise.
Why use moving averages?
By identifying trends, moving averages allow traders to make those trends work in their favor and increase the number of winning trades. We hope that by the end of this tutorial you will have a clear understanding of why moving averages are important, how they are calculated and how you can incorporate them into your trading strategies.