Moving Average

A Moving Average is an indicator that calculates the average value of prices (or any specified data series) over a period of predetermined period of time.

The most popular method of interpreting a moving average is to compare the relationship between a moving average of the price with the price itself. A buy signal is generated when the price rises above its moving average and a sell signal is generated when the price falls below its moving average.

How to interpret price trends using the Moving Average:

The interpretation of an indicator's moving average is similar to the interpretation of the price’s moving average: when the indicator rises above its moving average, it signifies a continued upward movement by the indicator; when the indicator falls below its moving average, it signifies a continued downward movement by the indicator.

This indicator falls under the Averages category of Chart indicators.