# How to Use Moving Averages (SMA and EMA)

> According to StockCharts ChartSchool, a simple average weights all days equally while an exponential average weights recent days more and reacts faster; both are based on past prices so they lag [1].

Last updated: 2026-10-22 · https://www.nx24.ai/en/rehber/hareketli-ortalamalar

## What is a moving average?

A line built by averaging a set number of closes and shifting the window with every new candle. It filters out price noise and shows the direction of the trend.

## SMA vs EMA

The simple average (SMA) weights all days equally. The exponential average (EMA) weights recent days more, so it reacts faster to price changes.

## 20, 50 and 200 periods

20 stands for the short, 50 for the medium and 200 for the long-term trend. Price above the 200-day average is read as a long-term uptrend.

## Crossovers

A short average crossing above a long one is called a golden cross; crossing below is a death cross. They often give false signals in sideways markets and are confirmed with volume and other indicators.

## Sourced notes

According to StockCharts ChartSchool, a simple average weights all days equally while an exponential average weights recent days more and reacts faster; both are based on past prices so they lag, and longer periods lag more [1]. The 50-day average is a common reference for the medium-term trend and the 200-day for the long-term trend [1].

## Limits

Moving averages are based on past data and lag. This page is educational, not investment advice.

## Frequently asked questions

**What is the difference between a simple and an exponential moving average?**

A simple average weights all days equally; an exponential average weights recent days more and reacts faster. Both are based on past prices so they lag, and longer periods lag more [1].

**What are the 50- and 200-day averages used as a reference for?**

The 50-day average is a common reference for the medium-term trend and the 200-day for the long-term trend [1].

## Sources

1. [Moving Averages - Simple and Exponential](https://chartschool.stockcharts.com/table-of-contents/technical-indicators-and-overlays/technical-overlays/moving-averages-simple-and-exponential). StockCharts ChartSchool. Accessed: 2026-10-22.

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