Which moving average works best for intraday trading in stocks?
What is moving average? A moving average (MA) is an indicator used in technical analysis. It gives you a constantly updated average stock price, so short-term market volatility and price action are smoothened out. So, even if the actual stock price rises and falls by small amounts over a period, you can assess the overall direction of price movements using a moving average indicator. Understanding moving averages: A moving average is a statistical calculation used to analyze data points over a specific period to identify trends and patterns. In the context of intraday trading, we primarily use two types of moving averages: Simple Moving Average (SMA) :- This is the arithmetic mean of a set of values over a specified period. For example, a 10-period. SMA is calculated by adding the closing prices of the last 10 trading sessions and dividing the sum by 10. Exponential Moving Average (EMA) :- EMA gives more weight to recent prices, making it react faster to price changes compared to S