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Is the 260 day moving average you use a simple or an exponential moving average?

I use a simple moving average. However there is a strong case for preferring an exponential moving average, depending on what you are using it for.

The way I use the 260-day moving average is to smooth out the price bars so that I can see the underlying major trend. For this purpose, I don't think it matters whether I use a simple or an exponential moving average. For convenience, I use the simple moving average. It also tends to give a slightly smoother line, but that is a peripheral reason.

It is important to understand that I do not use the moving average line as a timing tool for trading. I am only concerned to see the basic pattern of the cycle or trend. However, others use moving averages as a trading system. This means that they will use changes in the direction of the line, or when price or a shorter moving average cross the line, to time their trading decisions. To the extent that the exponential moving average reacts more quickly to significant recent price changes, it will be the preferred method to use.

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