Simple MA's 20 and 50 are averaged to produce a mean MA line. I like the smoothness of it, and it can help you stay in a trade in the slow moving trends. Also if you start to see a large cloud in your favor, it could be a great time take the profits.
Hello, thank you very much for the indicator, it is fantastic the average and the smoothness you get, by chance you will have MT4 ?
HammondB3
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@PabloFX, I do have this study in .mq5 form. I am not familiar with T-View's policy on cross pollination of platform languages. Before I would share that with you, I would like to make sure I am in compliance.
SG_Investor
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Maybe this a noob Q, but wouldn't the average of two SMAs lets, say 20 and 50, just be similar to the 35 SMA line? What is the additional benefit of using this instead? Thanks
HammondB3
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@SG_Investor, no it is nothing like 35 sma.. you can always pop one up and compare. This average is simply a 3rd level derived smoothing agent, and 20 and 50 are picked because they are widely used individually. This gives you a middle ground to "sell higher than" or buy lower than". That advantage is small at best as it only helps to bias. However, still we should always be looking to buy below the middle and sell above it and the clouds here help you determine when we are far out from the middle. You can find several mov average setups, it is all about what gives you some sort of trading angle you like. This may or may not be it and that is ok.
lemoon38
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Hi, I really liked your work, tell me how to make an alert for a trend change?
HammondB3
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@lemoon38, You can do this by selecting the Alert Tab at the top of tradingview's chart. Then select the symbol in the top box, and then crosses up, then 20:50mean, then to the right of that "mean" then set your frequency. :) Hope this helps. To code in the alerts it needs to be converted to version 4 pinescript