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Joined Jan 2017
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Status: Young Trader
|31 Posts
I am very dissapointed in this thread, eventhough this is over 10 years ago. I have been trying to find the diffirence between wma and lmafor a while now. Maybe if one of you guys took the time to answer instead of critique lots of people would have found their answer a lot easier.
All these which u said are moving averages a.k.a MA. SMA is a Simple Moving Average, EMA is an Exponential Moving Average, WMA is a Linear Weighted Moving Average. And there is also another one which is Smoothed Moving Average.
All these which u said are moving averages a.k.a MA. SMA is a Simple Moving Average, EMA is an Exponential Moving Average, WMA is a Linear Weighted Moving Average. And there is also another one which is Smoothed Moving Average.
Ignored
That’s the appropriate answer! Actually, WMA is not much popular as like SMA,EMA; maybe that’s why he asked for this question.
Weighted Moving Average, WMA is any average that sets different weights for observed values of a random variable. The idea behind its calculation is to give more weight to new observations and less weight to older observations. This is a logical approach in technical analysis in terms of determining the nature and strength of the prevailing trend on the market. Such an approach allows not only to smooth out sharp price deviations, but also to determine more accurately the direction of the trend, since the latter data is given greater specific weight.
WMA - A weighted moving average is a trend indicator. This smoothing removes some of the drawbacks of an ordinary moving average, it is also not without drawbacks: the lag of entry and exit points is still there, but much less than a simple moving average. But due to giving more weight to the latter values, the indicator reacts faster to changes.
The Moving Average eliminates all fluctuations and shows in a simple form the prevailing mood in the market.
Moving averages are also often part of more complex indicators and are the most commonly used indicator in technical analysis. When calculating a moving average, a mathematical averaging of the instrument price for a given period is performed. As the price changes, its average value either increases or decreases.
When performing technical analysis, this moving average can serve as a resistance line or a support line. This indicator refers to the indicator with a delay, which allows avoiding rash and reckless actions.
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Additional Username
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Joined Mar 2020
|170 Posts
All moving averages, including the WMA, are not designed to identify a trade at the exact bottom or top. Moving averages tend to validate that your trade is in the general direction of the trend, but with a delay at entry and exit. The WMA has a shorter delay then the SMA.
