Stock Term: What Is The Moving Average

The moving average indicator is actually the abbreviation of the moving average indicator. Since this indicator is an important indicator reflecting the price movement trend, once its movement trend is formed, it will continue to maintain for a period of time. The high or low points formed by the movement of the trend have the function of blocking or supporting respectively, so the point where the moving average indicator is located is often a very important support or resistance level, which provides buy or sell Favorable opportunity The value of the moving average system is also here.

　 average It is divided into ordinary moving average and exponential moving average.  　

Ordinary moving average: It is an ordinary average of the closing price of a certain period in the past. For example, the 20 day moving average is the sum of the closing prices of the past 20 trading days and then divided by 20 to get a value; Then push forward 20 times from yesterday Trading day , the same method calculates another value, and so on. Connect these values to form a common moving average.  　　

Exponential moving average: The formation method is identical to the ordinary moving average, but the calculation method is different when calculating the moving average value. For example, the 20 day moving average and the index moving average adopt the method of index weighted average. The closer to the day, the greater the proportion, rather than the average distribution of the proportion as in the ordinary moving average. Therefore, the exponential moving average can reflect the latest changes more quickly in most cases.