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Moving Average Adaptive

by | Oct 4, 2020

Disclaimer: Posts on the HyperTrader blog and associated HyperLinq websites are for educational and informational purposes only. These posts should not be taken as financial advice, nor are they meant to be viewed as trading advice. HyperLinq Inc. or the authors take no responsibility for any damages or losses.

When trading crypto assets, it is crucial to recognize market conditions. Crypto traders will use several technical analysis tools at the same time to better understand market conditions. This blog will discuss two technical indicators, the Moving Average Adaptive, which help crypto traders make better trading decisions in markets like BTC & ETH.

Moving Average Adaptive

Perry Kaufman formed Moving Average Adaptive; Kaufman’s MA logic is a MA created to consider market volatility. Moving Average Adaptive will carefully observe prices when the price fluctuations are comparatively inadequate and low volatility. At the same time, it will also adapt when the price fluctuations stretch and follow rates from a more excellent range. This trend-following indicator can be applied to recognize the overall trend, time turning points, and filter price tendencies. 

There are various measures needed to calculate Moving Average Adaptive. Let’s begin with the settings suggested by Kaufman:

  • Ten is the number of periods for the Efficiency Ratio (ER).
  • Two is the number of periods for the most active EMA constant.
  • Thirty is the number of periods for the most passive EMA constant.
Moving Average Adaptive Indicator on HyperTrader

Like other MAs that crypto traders utilize, buy and sell flags are produced through bullish and bearish crossovers. A bullish crossover occurs if the active MA intersects the gradual one upwards, which would begin a trading position. Bearish crossovers are contrary and will close a trade position or initiate a short. When all is set and done, MAA is a helpful trading tool for a crypto trader. 

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