Simple Moving Average (SMA)

#What you see

A single line on the price chart. Each point is the average close of the last Period candles, the current candle included. The line starts on the Period-th loaded candle; before that there is no value.

#How it is calculated

SMA = (sum of the last N closes) / N, with N = Period.

Every close in the window has the same weight. With each new candle the oldest close drops out of the window and the newest one comes in.

#How to read it

• Price above a rising SMA points to an uptrend, price below a falling SMA to a downtrend. A flat SMA that price keeps crossing signals a range.
• A longer period gives a smoother line that reacts later; a shorter period follows price closely but produces more false signals.
• Two SMAs with different periods are often combined: the short one crossing the long one marks a shift in momentum.
• Because old and new prices count equally, the SMA lags more than an EMA of the same period.

#Using it in strategies

The SMA has one output, value (a price). In the Trade Setup you can use it with the rule "Price vs line", for example as a filter that allows longs only while the close is above the line, or with "Compare" against another moving average. In WickScript use the built-in sma(source, length), e.g. sma(close, 50), or load this indicator with use indicator "SMA" with period 50 as slow and read slow.value.

#Settings

Open the settings with the slider icon next to the indicator (Indicators, F3). Numeric settings can be swept as Step 1 / Step 2 parameters when you run a strategy.

#Inputs

#Styles

#Outputs

These values can be used in Trade Setup triggers, filters and exits (see Trade Setup) and in WickScript.

#Use in WickScript

use indicator creates this indicator inside a script, with settings by their ID. Each output is a field of the name after as. See WickScript indicators.

wickscript 1
indicator "Simple Moving Average (SMA) from the list" on chart
use indicator "SMA" with period 21 as mySma
show mySma.value as line "value"