Trading Short-Term & Long Term Price Period of MA

A trader can choose to adjust the price periods used to calculate the moving average MA.

If a trader uses short price periods then the MA will react faster to the changes in price.

For example if a xauusd trader uses the 7 day MA then, the moving average indicator will react to the price change much faster than a 14 day or 21 day MA would. However, using short time price periods to calculate the Moving Average might result in the technical indicator giving false signals (whipsaws).

Short-term and Long-term Moving Averages Strategies - MA Indicator Analysis

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If another trader uses longer chart time periods then Moving Average will react to price changes much slower.

For example, if a trader uses the 14 day Moving Average indicator then the average will be less prone to whipsaws but it will react much slower.

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Trading Short-Term & Long Term Price Period of MA