SMA

A simple moving average (SMA) is calculated by adding together prices in a given time frame and dividing by the number of time frames. The SMA is basically the average price of the given time period, with equal weighting given to the price of each period. Traders interested in medium-term trends would opt for longer moving averages that might extend 20-60 periods. Long-term investors will prefer moving averages with 100 or more periods.