What is Simple Moving Average (SMA)?
A simple moving average, or SMA, adds up the closing prices over a chosen number of bars and divides by that count, giving each bar equal weight. Because every bar counts the same, it reacts slowly and stays smooth. It is the most basic form of moving average.
Why Simple Moving Average (SMA) matters
It is the plainest trend line, so understanding it makes every other moving average easier to grasp.
Related terms
Lessons that use this term
Continue