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 Moving Average Time Frames or Periods.

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Posts : 22
Join date : 2011-04-13

PostSubject: Moving Average Time Frames or Periods.   Tue May 17, 2011 8:15 am

Moving average measures the exchange rates of a currency pair over a specified number of periods and this way provides an objective view of trend direction by smoothing currency price rates. All price values are with respect to the current displayed chart time frame. The moving average indicator is calculated by averaging price values over the specified interval length and you may apply different time periods. The shorter time frames MA‘s are more sensitive and identify new trends earlier, but also give more false trading signals. The longer time periods MA‘s are more reliable but less responsive. Moving averages represent the arithmetic mean of the daily closing prices of a concrete currency pair instrument (i.e., the sum of the previous “n“ time periods divided by “n“) also known as a "simple" daily average. Increments larger or smaller than days (minutes, hours, weeks, months) can be used when desired.
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