Moving Averages (MA) are a building block for many Technical Analysis indicators, and are among the most widely used Technical Analysis techniques. They are used to eliminate short-term fluctuations in time series and to highlight long-term trends and cycles. There are four commonly used moving averages: simple, smoothed, weighted and exponential.

The Moving Average model applied by GStock is a simple Moving Average - unweighted mean of the previous 'n' data points in the time series. Each model is comprised of 2 simple moving averages, a shorter Moving Average and a longer Moving Average. As the market advances, the shorter Moving Average rises above the longer Moving Average, and vice versa. A BUY signal is indicated when the shorter Moving Average has a larger value than the longer Moving Average. A SELL signal is indicated when the shorter Moving Average value lags below that of the longer Moving Average.

Calculation:

Where:

• n = Number of time periods in the moving average

To see the Moving Average calculation of 7-days and 14-days in Excel, click here: Attach:MovingAverage.xls