![]() ![]() But that also makes them lag prices (Murphy, 1999). Moving averages filter out market noise because they summarise data from several bars into a single value. That signal is bullish when prices move above its moving average, and bearish when they fall below it. When price crosses its moving average, the trend changes. In general, a rising price-based moving average indicates market strength and a declining one signals weakness (Pring, 2002). Moving averages are a typical trend-following tool. The ‘moving’ part refers to the fact that a moving average is based on a certain number of bars, and with each new price bar the window over which we calculate the average changes (Murphy, 1999 Pring, 2002). ![]() Moving averages smooth values and make it easier to see the underlying trend. ![]() # Coding moving averages in TradingView Pine scripts
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