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Simple Moving Average (SMA) Explained. A simple moving average (SMA) is the simplest type of moving average in forex analysis (DUH!). Basically, a simple moving average is calculated by adding up the last âXâ periodâs closing prices and then dividing that number by X.
Slow Stochastics will be found at the bottom of your chart. It is made up of two moving averages. The faster moving average is a blue line, the K line, while the slower moving average is the red line, the D line. These two MAs will move between the 80 line and the 20 line.