Fxbasic

Binance The World's Leading Cryptocurrency Exchange. Posts are not directed towards UK users.
Discover AI-powered crypto insights with Binance Crypto Analysis Bot: https://t.me/BinanceCryptoAnalysisBot

MOVING AVERAGE

Moving averages are one most commonly used technical indicators.

A moving average is simply a way to smooth out price fluctuations to help you distinguish between typical market “noise” and the actual trend direction.

By “moving average”, we mean that you are taking the average closing price of a currency pair for the last ‘X’ number of periods.

On a chart, it would look like this:



As you can see, the moving average looks like a squiggly line overlayed on top of the price (represented by Japanese candlesticks).

This type of technical indicator is called a “chart overlay“.

The moving average (MA) isoverlayed on the price chart! Ya dig? 😎

Like every technical indicator, a moving average (MA) indicator is used to help us forecast future prices.

But why not just look at the price to see what’s happening?

The reason for using a moving average instead of just looking at the price is due to the fact in the real world, aside from Santa Clause not being real…..trends do not move in straight lines.

Bollinger Bands
• Used to measure the market’s volatility

• They act like mini support and resistance levels

• Bollinger Bounce

* A strategy that relies on the notion that price tends to always return to the
middle of the Bollinger Bands
* You buy when the price hits the lower

Bollinger band
* You sell when the price hits the upper

Bollinger band
* Best used in ranging markets

• Bollinger Squeeze

*A strategy that is used to catch breakouts early
* When the Bollinger bands “squeeze” the price, it means that the market is
very quiet, and a breakout is eminent. Once a breakout occurs, we enter a
trade on whatever side the price made its breakout.