SMASimple Moving Average
Equal-weighted average of the last N closes. Smoother than EMA, slower to react.
A Simple Moving Average is the equal-weighted average of the last N closing prices. SMAs are smoother and slower than EMAs, which makes them better for identifying long-term trend direction (200 SMA is the institutional bull/bear dividing line) but worse for entry timing.
Most pros use SMAs for context (200 SMA as the macro filter) and EMAs for execution (9/21/50). The middle band of Bollinger Bands is a 20-period SMA — its slope tells you whether the band system is in trend mode (sloping) or range mode (flat).
Strategies that use SMA
Browse more terms
Apply SMA on a real chart
Drop a chart, and TradeLens AI shows you where SMA appears — in seconds.
Try it free