Moving Average (MA)

Indicator frequently employed in technical analysis with the purpose of generating a price's moving average during a specific period of time. The indicator is made of a single line that displays a continuously updated average price value in order to assist smooth out the price data. Moving average indicators can be simple- and exponential- data driven. The formula for the simple moving average indicator takes into equal consideration the closing price values recorded during a specific period of time (21-days, 50-days...). The exponential version of the indicator does the same calculation as the simple version of the indicator. However the exponential moving average places more emphasis on the most recent price values, making those values more responsive and current to the new information.