Trend: moving averages
SMA, EMA and the other averages, what they are for and which to pick.
Moving averages are the most-used line for reading direction: they condense the price of a number of candles into a single line that moves with it. Konsole offers several variants, differing in how quickly they react to recent prices.
What they are for
- Reading the trend (price above the average = bullish phase, below = bearish).
- Using the average as dynamic support/resistance.
- Building crossovers between two averages of different length.
The available variants
- SMA, simple average: smooth, slow to react.
- EMA, exponential: gives more weight to recent prices, reacts sooner.
- WMA / DEMA / TEMA / HMA, weighted and smoothed in different ways to cut lag while keeping the line clean (HMA is among the most reactive).
- VWMA, volume-weighted: counts more where more traded.
- LSMA, linear regression: follows price with less lag.
Common parameters
- Period, how many candles it is computed over (higher = slower and smoother).
- Source, which price (close, typical, and so on).
- Colour and width, appearance only.
Which to pick is a matter of style: start from EMA or SMA and tune the period to your timeframe.