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WHAT IS THE PURPOSE OF MOVING AVERAGES?

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jinz13

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The main purpose of the moving average is to eliminate short-term fluctuations in the market. Because moving averages represent an average closing price over a selected period of time, the moving average allows traders to identify the overall trend of the market in a simple way.

Another benefit of the moving average is that it is a customizable indicator which means that the trader can select the time-frame that suits their trading objectives. Moving Averages are often used for market entries as well as determining possible support and resistancelevels. The moving average often acts as a resistance level when the price is trading below the MA and it acts as a support level when the price is trading above the MA.
 
The main purpose of the moving average is to eliminate short-term fluctuations in the market. Because moving averages represent an average closing price over a selected period of time, the moving average allows traders to identify the overall trend of the market in a simple way.

Another benefit of the moving average is that it is a customizable indicator which means that the trader can select the time-frame that suits their trading objectives. Moving Averages are often used for market entries as well as determining possible support and resistancelevels. The moving average often acts as a resistance level when the price is trading below the MA and it acts as a support level when the price is trading above the MA.
I find them very laggy, but for longer trends they work well - it's just hard to determine is there is a trend of not.
 

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