A moving average is the average closing price over the last N days. The simple average (SMA) weights every day the same; the exponential average (EMA) weights recent days more.
- The 20-day average shows the short-term trend, the 50-day the medium term and the 200-day the long term.
- A price above its 200-day average is widely treated as being in a long-term uptrend.
Golden cross and death cross
A golden cross is when the 50-day average crosses above the 200-day: a sign the trend may be turning up. A death cross is the opposite. Both are slow signals that confirm a trend rather than predict one.