Wilder Moving Average
The Support and Resistance levels are analyzed using the moving averages including trend and reversals. Wilder Moving Average and Exponential Moving Average will change before an SMA as they are more responsive to up to date prices. They are apt for dynamic trade. Moving averages similar to SMA tend to move more slowly giving us the required information on the long existing trend.
WSMA(i) = (SUM1-WSMA1+CLOSE(i))/N
WSMA1 = Wilder’s Smoothing for the first period.
WSMA(i) = Wilder’s Smoothing of the current period(except for the first one).
CLOSE(i) = The current closing price.
N = The smoothing period
When a price crosses a moving average it is known as price crossover.
Bullish signals are likely when the price moves above the Moving Average.
Bearish signals are likely when the price moves below the Moving Average.
The best consequences for the crossover trading can be predicted when the moving average slopes are in the direction of the trade.