Understand before you act
Simple Moving Averages, explained
An SMA is the average of the most recent observations. It smooths fluctuations so the direction of a trend is easier to see.
How Index Screener uses it
SMA 20, 50 and 200
SMA 20, 50 and 200 use equal weights over their respective lookback periods. Daily signal badges calculate these averages from index closing levels.
What it helps you assess
Compare short, medium and long-term trend direction.
What it cannot tell you
Longer averages react more slowly. In a range, price can cross an average repeatedly without establishing a lasting trend.
Before an entry or exit
These are learning examples to build your own checklist. They are not tested trading rules or personalized recommendations.
Look for confirmation
A trend checklist can combine a rising average with a pullback that holds support. A price crossing above an average may need follow-through.
Follow your risk plan
Choose the average and invalidation level that fit your timeframe before entering. Review a sustained support break rather than change the exit rule after a loss.
Keep learning
Further reading
References explain the indicators. Site rules and the example checklists above are described by Index Screener.