4.4

SR Trend Lines - Moving Averages

In this lesson, we will talk about the use of Moving Averages (MAs) in Forex trading.
Like simple trend lines and price channels, moving averages can act as another type of trend line that helps clarify a price trend because they smooth out the gyrations of individual price or candle movements.
Moving average lines for a given period don’t plot the actual price at a given moment. Instead, each point on these lines is the average closing price of a certain number of prior candlesticks or periods.
As each new closing price is added, the oldest one is dropped from the calculation, hence the term "moving average".

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