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Trendline MAK

The simple moving average (SMA) is a straightforward technical indicator that is obtained by summing the recent data points in a given set and dividing the total by the number of time periods. Traders use the SMA indicator to generate signals on when to enter or exit a market. An SMA is backward-looking, as it relies on the past price data for a given period. It can be computed for different types of prices, i.e., high, low, open, and close.

In financial markets, analysts and investors use the SMA indicator to determine buy and sell signals for securities. The SMA helps to identify support and resistance prices to obtain signals on where to enter or exit a trade.

When generating the SMA, traders must first calculate this average by adding prices over a given period and dividing the total by the total number of periods. The information is then plotted on a graph.

The formula for Simple Moving Average is written as follows:

SMA = (A1 + A2 + ……….An) / n
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