Moving Average Types and the MAs Traders Use Most
How SMA, EMA, WMA, SMMA and HMA differ, with worked math, plus the popular 9, 20, 21, 50, 100 and 200 lines for trend, dynamic support/resistance and crossovers.
- An MA is the average of past prices. It helps you see the trend but always lags price
- EMA reacts faster than SMA because it gives more weight to recent prices
- The most watched lines are the 20, 50 and 200
- Crossover signals work well in trending markets but give many false signals in sideways markets
A Moving Average (MA) is the average price over a set number of past candles. Each time a new candle forms, the average moves along with it. The result is a line that is smoother than price itself, so you can see the trend direction without getting distracted by every candle’s swing. The downside is that it always lags price, because it is built from past prices.
Types of MA
| Type | Full name | How it works | Speed |
|---|---|---|---|
| SMA | Simple Moving Average | Every candle has equal weight | Slow, steady |
| EMA | Exponential Moving Average | Recent candles weigh more, fading off exponentially | Faster than SMA |
| WMA | Weighted (Linear Weighted) | Weight falls in a straight line, the latest candle weighs most | Fast |
| SMMA | Smoothed (or RMA) | Adjusts a little at a time, used inside RSI and ATR | Slowest |
| HMA | Hull Moving Average | Stacks several WMAs to reduce lag | Very fast, but jumpy |
MT4/MT5 offers 4 types: Simple, Exponential, Smoothed and Linear Weighted. TradingView has every type in the table.
Worked example: why EMA is faster
Say the last 5 closes are 11, 12, 13, 14, and then a new candle jumps to 20. The previous 5-candle average was 12.
| Type | Calculation | Result |
|---|---|---|
| SMA 5 | (11 + 12 + 13 + 14 + 20) ÷ 5 | 14.00 |
| EMA 5 | 12 + 2÷6 × (20 − 12) | 14.67 |
| WMA 5 | (11×1 + 12×2 + 13×3 + 14×4 + 20×5) ÷ 15 | 15.33 |
When price jumps sharply, the lines that weigh recent candles more move further with it. The EMA multiplier is 2 ÷ (number of candles + 1), so EMA 20 gives the latest candle about 9.5% of the weight, while EMA 200 gives it only about 1%.
Popular lines and what they’re for
| Line | Common type | What it’s for |
|---|---|---|
| 9 or 10 | EMA | Very short-term trend, used on minute to hourly charts |
| 20 or 21 | EMA or SMA | Short-term trend, where price often pulls back to in a strong trend. SMA 20 is the middle line of Bollinger Bands |
| 50 | SMA or EMA | Medium-term trend |
| 100 | SMA | Medium to long-term trend |
| 200 | SMA | Long-term trend, the line the whole market watches most. Price above or below it is used to split bull and bear markets |
Pairs often used for crossovers:
- 50 and 200 on the daily chart. The 50 crossing above the 200 is called a Golden Cross. Crossing below is a Death Cross
- 9 and 21 EMA for timing on short-term charts
- 12 and 26 EMA, the base of the MACD indicator
In crypto, traders often watch the weekly chart: the 20-week SMA paired with the 21-week EMA, known as the bull market support band, and the 200-week line for the very long-term picture.
These numbers are not more magical than any others. They work often because many people watch the same lines, so orders wait around them.
Timeframe changes what a line means
A 200 line covers a different amount of time on each timeframe.
| Timeframe | 200 candles cover about |
|---|---|
| 15 minutes | A little over 2 days |
| 1 hour | About 8 trading days |
| 4 hours | About a month and a half |
| Daily | About 9 to 10 months |
If someone mentions “the 200” without naming a timeframe, they usually mean the daily chart.
4 ways to use an MA
1. Read the trend direction
Price above the line and the line pointing up: treat it as an uptrend. Price below the line and the line pointing down: treat it as a downtrend. If the line is flat and price keeps crossing it, the market has no direction yet.
2. Moving support and resistance
In a healthy trend, price often pulls back to the 20 or 50 line and then continues. Many traders wait for this instead of chasing price.
3. Read how several lines stack
If the short lines sit above the long lines in order, for example 20 above 50 and 50 above 200, the uptrend is strong on every horizon. The reverse order means a downtrend. Tangled lines mean no trend.
4. Crossover signals
A short line crossing a long line suggests momentum is changing. But because MAs lag price, the signal often comes after price has already moved a fair way, and in sideways markets the lines cross back and forth, giving false signals often.
Common mistakes
- Using crossover signals in a sideways market and getting faked out again and again
- Adding so many lines the chart becomes unreadable. 2 to 3 lines are usually enough
- Tweaking the numbers to fit past charts, which usually fails in the future
- Forgetting that an MA follows price. It does not warn you of a reversal in advance
- Using a line as the only reason to enter, without checking support and resistance or setting a Stop loss
Suggested settings for beginners
- Daily or 4-hour chart: EMA 20, SMA 50, SMA 200
- Short-term charts: EMA 9 and EMA 21, with SMA 200 alongside to know the big direction
- Use the close price for the calculation, like most traders do
Frequently asked questions
Which is better, SMA or EMA?
Neither is better in every situation. EMA reacts quickly and suits short-term trading. SMA is steadier and suits long-term trend reading. Many traders use EMA for the short lines and SMA 200 for the big trend.
What is the best MA setting?
There is no magic number. The lines that work often are the ones many people watch, like 20, 50 and 200, because orders wait around them. Tuning the numbers to fit past charts usually stops working in the future.
Can I use MAs on crypto?
Yes, the method is the same in every market. For bitcoin, traders often watch the weekly chart, the 20-week SMA paired with the 21-week EMA, and the 200-week line for the long-term picture.
Which price should the calculation use?
Most platforms default to the close, which is what most traders use. Stick with the close so you see the same line as the rest of the market.
This is general education, not investment advice. Trading is risky and you may lose all of your capital.