What is a Simple moving average?
The SMA or Simple moving average is a simple indicator that helps traders to analyse security over a period of time. This indicator is widely used in Binomo for the analysis of possible trends and reversals. You can easily calculate the SMA while taking a sip of coffee. In order to calculate SMA, you need to add the closing price of the desired numbers of security and then divide it by the number of periods. For instance, you want to calculate the SMA of Bitcoin for the last 1 hour. Now in order to calculate the SMA for the last 1 hour. firstly you need to set the period of the candlestick to 10 minutes next add the closing price of the last six candles and then divided by 6. The result will be the simple moving average of the last 1 hour of the Bitcoin.
How to add a Simple Moving average on Binomo?
In order, to add the Simple Moving average on Binomo. Firstly, log in to your Binomo account. In case, you don’t have one fill out the form below.
Secondly, click on the asset button. and select your desired currency. For instance, here I select EUR GBP.
The third step is to set your default to the candlestick as a Simple Moving average works best with a candlestick chart.
Lastly, click on the indicator button. and search for Moving average and select SMA from the drop-down.
Now, change the period of the indicator line to 30 and you can change the colour of the indicator line if you wish to do once, you are done click apply.
How to place trades using a Simple Moving average on Binomo?
The SMA indicator is used to identify the direction of the trend, whether it is an uptrend, downtrend or sideways trend. finding and placing trades using a simple moving average indicator is very easy you need to eye on the intersection of price and the indicator line.
When the price of the asset intersects above the SMA line it signals a possible bullish trend and here you can place a buy trade.
Similarly, When the price of the asset intersects below the SMA line it signals a possible bearish trend and here you can place a sell trade.
Winding up
The SMA (Simple Moving Average) indicator is a popular technical analysis tool used by traders on the Binomo platform. The Indicator can be used to identify the upcoming bullish and bearish trends. This indicator calculates the average price of an asset over a specified period of time that helps traders to identify the upcoming trend direction of a security. I will highly suggest you try this trading indicator on the Binomo demo account and shift to Binomo real account once you are confident enough.
I wish you the very best of luck!!!