What Is a Moving Average Chart?
A moving average chart is used to assess the stability of a process. It is used in various fields, including construction and manufacturing, for analyzing minor movements and variations in processes over a specific time period. Moving average control charts are an essential technical tool for most stock and commodities traders who utilize them for identifying market trends and reversals. Traders also rely on these charts to determine an asset’s support and resistance zones, and to set stop-losses. The two most common methods for creating chart moving averages are the simple moving average method and the exponential moving average method.
