Moving averages and volume

MA(7) is the average close of the last 7 candles; MA(25) of the last 25; MA(99) of the last 99. On each new candle, the oldest one drops out and the newest is added — the average "moves".

• A short MA (7) reacts quickly to price changes.
• A long MA (99) reacts slowly and shows the longer trend.

The interval matters: MA(25) on an hourly chart covers about one day; on a daily chart, about a month.

• Direction: a price above a rising MA is usually described as an uptrend.
• Crossovers: when a short MA crosses above a long MA, some traders read it as strengthening momentum (and the opposite when it crosses below).
• Dynamic levels: in trends, the price sometimes pauses near a moving average.

Moving averages lag behind the price, because they are made from past data.

Volume shows how much was traded. Many traders look for:

• rising volume in the direction of a move — a sign of strong participation;
• a breakout with high volume — more convincing than one with low volume;
• unusual volume spikes — a sign that something has changed.