Simple Moving Average
The
(SMA) is a widely utilized indicator in technical analysis, offering a smoothed-out price average over a specific time period. It's calculated by adding up the prices of the asset for a set number of time periods, then dividing this total by the number of time periods.
Key Characteristics of SMA:
- Simplicity and Clarity: The SMA provides a clear view of the price trend by dampening the noise of daily price fluctuations.
- Trend Identification: It helps in identifying the direction of the trend. A rising SMA indicates an uptrend, while a declining SMA suggests a downtrend.
- Support and Resistance: Often, the SMA can act as a support or resistance level for price movements.
- Crossovers: Traders pay close attention to SMA crossovers. When a short-term SMA crosses above a long-term SMA, it may signal a buying opportunity, known as a "golden cross." Conversely, when the short-term SMA crosses below
import { Bar , InstrumentProcessorBase } from '@botmain/common';
import { SimpleMovingAverage } from '@botmain/indicators';
export class InstrumentProcessor extends InstrumentProcessorBase {
sma = new SimpleMovingAverage (14);
...
onBarClose(bar: Bar ) {
//Add bar close to calculate new simple moving average
this.sma.add(bar.close);
...
if(bar.open < this.sma.last && bar.close > this.sma.last) {
//price crossed simple moving average. Place trade..
}
}
}