Statistical analysis
Moving Averages and Trend Classification
A moving average smooths recent prices to describe direction; it does not know what price will do next.
Reviewed 1 September 2026Simple and exponential averages
A simple moving average weights observations equally. An exponential moving average gives more weight to recent prices while still retaining information from older observations.
The site’s trend comparison
Share Market Open compares a 5-session EMA with a 20-session EMA. The gap is evaluated relative to recent volatility before the model classifies the trend as upward, downward or neutral.
Lag and false signals
Moving averages are derived from past prices and therefore lag. Sideways or rapidly reversing markets can produce classifications that change soon after they appear.
Educational interpretation
The classification is a description of recent data. Signal strength is not a probability of profit and must not be read as an instruction to buy, sell or hold.