What Is the Exponential Moving Average?

The Moving Average Convergence and Divergence (MACD) was developed in response to the lack of a moving average as a backward indicator. In order to solve the problem that once the price has expanded from the moving average, the average cannot be immediately reflected. EXPMA can reduce similar disadvantages.

Exponential smoothing moving average

EXPMA (Exponential Moving Average) translation exponential smoothing moving average was developed in response to the lack of moving averages as a backward indicator. In order to solve the problem that once the price has moved away from the moving average and the average has failed to respond, EXPMA can reduce similar disadvantages.

In general, many investors

Find the N-day exponential smooth moving average of X, which is generally expressed in the stock formula as: EMA (X, N), where X is the closing price of the day and N is the number of days. The real formula expression is: average index of the day = smoothing coefficient * (index of the day-average of yesterday's index) + average of yesterday's index; smoothing factor = 2 (periodic unit + 1); derived from the above formula, we get : EMA (N) = 2 * X / (N + 1) + (N-1) * EMA (N-1) / (N + 1);

1. The EXPMA indicator consists of EXPMA1 (white line) and EXPMA2 (yellow line). When the white line crosses the yellow line from bottom to top, the stock price will usually continue to rise. Then the day when the two lines form a golden fork is to buy. Into the opportunity.

2. When the stock price of an individual stock is far from the white line, the stock price of the stock will soon fall back, and then move along the white line. It can be seen that the white line is a major support point.

3. Similarly, when the white line breaks through the yellow line from top to bottom, the stock price has tended to turn around and will mainly fall in the future. The day when the two lines cross is the time to sell. ^[2]

1. This indicator is generally a short-to-medium-term stock selection indicator, which is more suitable for short-to-medium-term investors. Based on this signal, buyers have a profit opportunity, but for mid-line investors, its reference significance seems to be greater. The main reason is that the indicator has great stability and low volatility.

2. If the white line and the yellow line keep up the distance, it means that the stock market will continue to be optimistic. Each time the stock price falls back to the white line, as long as it does not break through the yellow line, this fallback is a good buy. opportunity. ^[2]