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Moving Average Forex Strategies

About the Moving Average Forex Strategy

Forex Moving average is one of the most widely used Forex Indicator because it is simple and easy to use.

This Trading Indicator is a market trend following trading indicator that's used by traders for three things:

  • Identify the beginning of a new trend
  • Measure the sustainability of the new trend
  • Identify the end of a trend & signal a reversal trading signal

The Moving Average or Forex MA is used to smooth out the volatility of price action. The MA is an overlay technical indicator & it is placed on top or superimposed on the market price chart.

On example chart below the blue line represents a 15 period MA, which acts to smooth out the volatility of the market price action.

Forex Moving Average Indicator - Moving Average Strategy Analysis Strategies

Forex Moving Average Indicator - MT4 Forex Chart Indicators

Calculation of the Moving Average

The Moving Average is also known as MA - is calculated as an average of price using the most recent price data.

If the MA uses the 10 period to calculate the average of the price then it is known as to as a 10 period forex moving average, because most traders use the day as the standard price period we shall just refer to it as the 10 day MA.

To calculate the ten day MA the price of the last 10 days is averaged, the forex moving average indicator is then updated constantly after every new price period. So after every new price period is formed the moving average is then calculated afresh using the most recent 10 price periods, that is why it is called a moving average because the average is constantly moving when price data is updated.

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