QuantTherapy

APEX - Moving Averages [v1]

QuantTherapy Updated   
A moving average is the most known indicator that takes into consideration price from the last several periods of the price and calculates a smoothed line also known as a Moving average. This way you will cut out a lot of the noise and have a different view.

The most common usage is the moving average crossover system when you buy and sell when a crossover happens. This system is in general not very profitable but can be used effectively in trending markets.

There is really no general rule to what length should be used. The most well-known and respected lengths are 20 / 50 / 100 / 200 for almost all average. These values are respected as strong resistance and support levels. but if you plan to use a crossover Systems the most profitable settings tend to be when the averages are close together 14 and 28 etc. But this is an area I would appeal to for you to really try out what works and what does not.

Other uses of moving averages are the following:
  • Crossover system
    Moving averages are pointing up and price crosses below (Buy Pullback)
    The slow-moving average is Below the fast moving average to help to identify possible bullishness
    Can be used as support and resistance lines

If you are an advanced user you may want to try out the following techniques:

Create your own moving average by combining several of those together with the source function
Using the Average True Range to create Keltner Channels
Using Standard deviation to create Bollinger bands (Bollinger bands are also accessible on their own)
You can use Moving averages to smooth the noise on other indicators such as RSI / CCI / MFI
Release Notes:
Added Price Below Short

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