Step 1 of 3
SMA and EMA: direction
Concept
A moving average smooths recent prices. An EMA weights recent values more heavily, so it reacts faster than an SMA.
Do this
Add a 20-period SMA and observe when price is above or below it.
Why it matters
Moving averages help describe trend; they do not predict the next bar.
Common mistake
Buying solely because price is above an average.
Check your understanding
Why does an EMA usually move faster than an SMA?
Practice in the real workspace
Return to the landing page to sign in or start a trial before opening the interactive workspace.