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| ==== Moving Average (MA) ==== | ==== Moving Average (MA) ==== | ||
| An average of data for a certain number of time periods. It "moves" because, for each calculation, we use the latest x number of time periods' data. By definition, a moving average lags the market. An exponentially smoothed moving average (EMA) gives greater weight to the more recent data, in an attempt to reduce the lag. See our ChartSchool article on [[:technical_indicators:moving_averages|Moving Averages]]. | An average of data for a certain number of time periods. It "moves" because, for each calculation, we use the latest x number of time periods' data. By definition, a moving average lags the market. An exponentially smoothed moving average (EMA) gives greater weight to the more recent data, in an attempt to reduce the lag. See our ChartSchool article on [[:technical_indicators:moving_averages|Moving Averages]]. | ||
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| + | ==== Moving Average Envelopes ==== | ||
| + | Moving Average Envelopes are percentage-based envelopes set above and below a moving average. This overlay is typically used as a trend-following indicator, but can also be used to identify overbought and oversold conditions when the trend is flat. See our ChartSchool article on [[:technical_indicators:moving_average_envelopes|Moving Average Envelopes]]. | ||
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| + | ==== Moving Average Ribbon ==== | ||
| + | Several moving averages with different look-back periods can be plotted on the same chart. The moving average lines resemble a ribbon moving across the chart. In addition to analyzing individual moving average lines on the ribbon, chartists can monitor the expansions and contractions of the ribbon width to determine trend strength and spot possible trend changes. See our ChartSchool article on [[:technical_indicators:ma_ribbon|Moving Average Ribbons]]. | ||
| ==== Multicollinearity ==== | ==== Multicollinearity ==== | ||
| Multicollinearity is a statistical term for a problem that is common in technical analysis, that being when one unknowingly uses the same type of information more than once. One needs to be careful and not utilize technical indicators that reveal the same type of information. See our ChartSchool article on [[:overview:multicollinearity|Multicollinearity]]. | Multicollinearity is a statistical term for a problem that is common in technical analysis, that being when one unknowingly uses the same type of information more than once. One needs to be careful and not utilize technical indicators that reveal the same type of information. See our ChartSchool article on [[:overview:multicollinearity|Multicollinearity]]. | ||