Forex Price Action Moving Average

This is where the price action takes place. A trend defines price action in which prices move in a specific direction over a period of time.

Visual Moving Average Indicator

Like any other trend indicator moving averages add to the actual chart.

Forex price action moving average. The use of moving averages in forex trading is probably one of the most popular methods around. The moving average crossover strategy is geared toward finding the mid! dle of a trend. In this article we will explore the six best price action trading strategies and what it means to be a price action trader.

Basically a simple moving average is calculated by adding up the last x periods closing prices and then dividing that number by x. It does this by representing previous price action for a specific period of time as a smooth line. What makes up price action before we dive into the strategies i want first to ground you on the four pillars of price action.

Using a combination of a short term ema and a longer term ema will help us identify the upward price surges. A moving average acts as a smoothing indicator. The moving averages that we will be looking at in this lesson are the 10 and 20 exponential moving averages.

The moving average ma is a trend indicator. This means no lagging indicators outside of maybe a couple moving averages to help identify dynamic support and resi! stance areas and trend. The exponential moving average on the ! other hand gives greater weight to more recent price action.

Whether its the 20 period the 50 period or a combination of different moving averages 930 is a popular combination its hard to to see a chart without an average on it. A simple moving average sma is the simplest type of moving average in forex analysis. Price action trading pat is the discipline of making all of your trading decisions from a stripped down or naked price chart.

Youll love todays lesson because im going to teach you a moving average trading strategy that ive been using for years and no its not moving average crossover. As the name implies the simple moving average is a simple average of a currency pairs movement over time. This is most effective forex price action trading strategy using moving average.

Moving Averages Trading Strategies