One of the most popular technical analysis indicators is the simple moving average also known as SMA, if you learn how to use these correctly they can be a very useful tool to help you to make good trading decisions.

The 50 simple moving average, or 50 SMA, is simply the sum of the last 50 values for each period, divided by 50, this is a moving window, as time moves on so does the average. Notice that I used the term period because this indicator works on any time period in exactly the same way.

It can be used on monthly, weekly, daily, hourly, 30 minutes, 15 minute and on whatever time period you want to monitor and trade. Although the SMA is the most commonly used there is also the exponential moving average or EMA. This is a weighted version of the formula using the mathematical exponent function to give more weight to the more recent values, this has the effect of making it a slightly faster average that many traders prefer.

The truth is that it probably does not matter if you used the SMA or the EMA, what does matter however is that you use one or the other and then be very consistent with it. Do not switch between them, it is more important that you learn to trust your chosen indicator then a slight difference in its value.

The SMA is oftern used to determine what the trend of the stock is, depending on the value used it could be a short term, medium term or long term trend. An important point to note is that moving averages are really only useful when the stock is trending, if the moving average is flat, i.e. horizontal on your chart it can become very choppy, this is a good time to stay out of the market.

The general rule is that if the current price is above the SMA the trend is up, if below the trend is down. This is very important to understand because it forms the basics of trend trading and trading with the trend.

For the short term trend many traders like using a 5-8 SMA or EMA, here is a trading secret, never trade again the direction of the short term tend, actually this is really just common sense when you think about it.

Moving averages often act as support or resistance, many traders use the 15, 21 or 30 SMA for this purpose.

There are a number of other very important moving averages that you need to know about, these are the 50, 100 and 200 SMA, and this mainly applies to the daily and weekly charts. A lot of big players in the markets, like the the mutual funds, investment banks etc use the 50 and 200 SMA as support and resistance, if they decide to buy or sell based on these you need to follow suite, the 100 to a lesser extent. These are very useful averages to watch if you trade EFT’s like an Oil ETF.

A useful tip is that when a stock breaks through one moving average it will often move all the way to the next, for example, if a stock breaks the 30 SMA it may move to the 50 before finding some support or resistance.

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where can i take a forex training course ?

foreign exchange or currency or ‘fx’, not like other major financial markets, never actually shuts down, it’s open 24/7, and is not only very leveraged, but extremely volatile and very unpredictable for traders to pick intraday price direction..

The fx or the currency market as the ‘pros would call it’, is always moving and is always an opportunity to make serious money and of course lose it just as fast.

Learn forex first and what it’s all about by first undertaking currency training and start your path out with a grounded training on this trading market we call forex.

Let a seasoned mentor or coach get you into forex trading, so you will get a firm grasp of what forex is all about and how you can seriously but safely exploit it to your advantage.Learn about forex indicators, charts and how to use them to make high probability trades. If you find currency markets too hard at first glance, keep searching for the best forex training website on the internet and continue to grow as an attentive market student, be a sponge and be a persistant  and of course become an ongoing learner.

You will look back at this one day and thank you’re lucky stars you selected to undertake serious training and education before commiting to currency training and speculation full time.

Of course, you are saying to yourself, why do I need to get training or help with trading endeavors when there is so much automated forex robots that can trade for me.?

we are here to tell you that currency market trading with robots is far from big time real life trading. We beg you to consider the fact that most online marketing companies sell such scam products that will not make money and will rob you of profits untill you go broke.

The trick is to ground yourself, and look for a real human and mentor to start trading with, to start forex training and coaching yourself into making good trades and develop good habits to keep winning your trades and make profits.

the best place to start forex trading training and develop your trading strategy is one that offers simple and logical ideas which you feel are workable in the market.

enjoy your trading.

all the best,

The Trader