Simple Moving Average (SMA)
A moving average that weights all periods equally.
Full Definition
The SMA calculates the arithmetic mean of prices over a specified period, giving equal weight to each data point. A 50-day SMA adds the last 50 closing prices and divides by 50. SMAs are smoother and less reactive than EMAs, making them useful for identifying longer-term trends. The 200-day SMA is widely watched as a long-term trend indicator.