Weighted Moving Averages

This is a discussion on Weighted Moving Averages within the First Steps forums, part of the Reception category; Quick and stupid question - if you were plotting a moving average on a Forex chart (or any other chart ...

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Old Sep 21, 2005, 1:50pm   #1
 
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Weighted Moving Averages

Quick and stupid question - if you were plotting a moving average on a Forex chart (or any other chart come to that), why would you want to "weight" the MA and what would be the potential advantage of looking at this instead of a simple moving average?

Can anyone satisfy my curiosity?
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Old Sep 21, 2005, 2:26pm   #2
 
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depending on the type of weighting, a weighted MA might turn quicker in some circumstances than a simple MA - this might be useful to you, or not, depending on your strategy
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Old Sep 21, 2005, 2:34pm   #3
 
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Weighted (and Exponential) Moving Averages assign more significance to the most recent price bars -so if you consider the most recent price action to be more important than earlier action you might use a weighted or exponential MA.
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