The moving average is the most-tested indicator in finance, and its record contains a twist almost nobody repeats. The best simple moving-average rules really did beat the market across ninety years of Dow data, and that result survived a brutal statistical correction for the number of rules tested. Then it stopped working the decade after it was published. Stranger still, the rules that won in the academic tests were 2-day and 5-day averages, not the famous 50 and 200 everyone quotes. This piece explains what a moving average measures, why it is late by construction, and what a century of testing actually says about trading it.

Pull up any chart and add a 200-period moving average. Instantly the picture organises itself: price above a rising line reads as an uptrend, below a falling line as a downtrend, and the chop in between as indecision. That is a genuinely useful thing to do in one click, and the moving average is the closest thing technical analysis has to an honest instrument.

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Moving Averages Explained: SMA, EMA and the Golden Cross