Moving Average
The average closing price over N periods, updated each bar — smooths noise and exposes the underlying trend direction.
A moving average (MA) calculates the mean price over a rolling window of N bars, plotting a smooth line that lags price. The two main types are the Simple Moving Average (SMA, equal-weight) and the Exponential Moving Average (EMA, more weight on recent bars).
Common uses:
- Trend filter: price above the MA = bullish bias; below = bearish.
- Dynamic support/resistance: price often pulls back to major MAs (20, 50, 200) and bounces.
- Crossovers: fast MA crossing above slow MA signals momentum shift (Golden Cross / Death Cross on long timeframes).
On the desk
NVDA is trending above its 21-day EMA for weeks. Each pullback to the 21 EMA holds, giving momentum traders a repeatable entry with a tight stop just below the MA.