What is the Meaning of the Moving Average? 

A Moving Average (MA) is a price trend-following indicator that notifies investors and traders regarding the price change in the stock market. You can check on the stock's average price movement in time concerning the actual stock price, which may go up or down to the MA line. 

You can use this moving average in two ways. One is to adjust the direction of the trend and find out the levels of support and resistance. The second one is varying the prices of stocks from time to time and it can be calculated whenever the price gets changed. 

What are the types of Moving Averages? 

In moving averages, there are two types available. They are:

Simple Moving Average (SMA) or DMA
Exponential Moving Average (EMA)

Moving Average Formula

You can see the MA formulas for two types. The first type of MA formula ie., simple moving average formula is 

SMA= (A1+A2+A3+...+An)/n. 

where:
A=Average in period n
n=Number of periods

It is used to determine a set of prices for financial instruments, that are summed up and divided by the number of prices in the whole set. 

The second type of MA formula i.e., the Exponential Moving Average (EMA) formula is as given below: 

EMA(current) = ( (Price(current) - EMA(previous) ) x Multiplier) + EMA(previous)

What is the Moving Average Crossover? 

A moving average crossover is an advanced edition of MA. The concept of MA lines is to calculate the average prices of collateral over multiple trading days. 
 
For example, a 200-day moving average crossover stocks for November 16 will apply closing prices from April 30 to November 15 to determine an average. The November 17 calculation will come from closing prices from April 31 to Nov 16. 

The best moving average crossover strategy for long-term investors is commonly 50-day and 200-day moving average crossover. Whereas short-term investors rely on a 5-day moving average. 

How To Understand The MA Crossover?

MA lines make it simple to understand the MA crossover. When one MA line gets in contact with another MA line or else with the stock chart uncovers bullish or bearish sentiment in the stock market. Also, it helps in determining the short-term movements. Below are the sample approaches of a crossover can appear:

• The MA is above the stock price, the stock rises in value and outdos the MA. Traders understand the stock price rising above MA as a bullish signal. 
• If the MA is below the stock price, the MA rises due to the drop in stock price. This kind of MA rising is called a bearish signal. 

How To Use A Moving Average Crossover Screener?

This online moving average crossover screener is useful in grasping whether any price change happened in the market hours today like moving average breakour or breakdowns. It mainly helps us to show crucial MA Crossovers for the stock at EOD.

The result of this moving average crossover screener looks like Symbol, 200 DMA (200 DMA positive breakout & 200 DMA breakdown, 100 DMA, 50 DMA, 20 DMA & Pivots Crossed. 

Stocks breaking out of 200 DMA or 200 SMA are essential applicants for Intraday trading or swing trading in the next coming days. 100 SMA, 50 SMA, and 20 EMA are some other crucial MAs to look out for in swing trades.