Moving Average the easiest indicators

Moving Average the easiest indicators
One of the easiest indicators to understand, the moving average shows the average cost of security over a period of time.
To find the 50-day moving average, we add the closing prices (but not always - I'll explain later) from the past 50 days and divided by the 50th Because prices are constantly changing, the moving average will move as well.
It should also be noted that moving averages are often used when compared or used in combination with other indicators such as moving average convergence divergence and exponential moving averages (EMA).
The most commonly used moving averages are 20, 30 50, 100 and 200 days. Each moving average provides a different interpretation of what the stock will do - there is not one right time frame.
The longer time period, the less sensitive the moving average will be the daily price changes.
Moving averages are used to emphasize the direction of the trend and smooth out price and volume fluctuations (or "noise") that can confuse interpretation.
Here is a visual example using the stock price of AT & T:

Note that back in September share price fell below its 50-day average (green line). There is a steady downward trend since then and no really strong divergence until the end of December when it rose above its 50-day average and continued to increase for several weeks.
Usually, when the stock price moves below its moving average, it's a bad sign because the stock is moving in a negative trend. The opposite is true for stocks that exceed their moving average - in this case, keep driving.