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Back to Indicators
TrendLagging

SMMA — Smoothed Moving Average

Overview

The Smoothed Moving Average applies equal weight to all historical data rather than dropping off older values, producing an ultra-smooth line that excels at identifying the dominant long-term trend. SMMA is the smoothing method used inside the ADX and ATR calculations, making it a foundational building block in technical analysis. It is best suited for stock and forex markets where long-term trend clarity is prized over speed.

How It Works

SMMA(1) = SMA(N). For subsequent bars: SMMA = (previous SMMA × (N − 1) + current close) / N. Because the previous average carries forward, the effective lookback is much longer than N periods. A 20-period SMMA behaves similarly to a 39-period EMA.

Key Signals

  • Price above SMMA confirms a long-term uptrend; below confirms a downtrend.
  • SMMA flattening after a trend signals potential consolidation.
  • SMMA crossovers are rare but highly significant when they occur.

Common Mistakes

  • Using SMMA for short-term signals — it's far too slow for scalping or day trading.
  • Comparing a 50-period SMMA with a 50-period SMA and expecting similar behaviour.
  • Not recognising that SMMA lag is by design — it filters noise at the cost of speed.

More Trend Indicators

GMMA — Guppy Multiple Moving Average

The Guppy Multiple Moving Average plots two groups of EMAs — six short-term and six long-term — to visualise the interaction between trader sentiment and investor sentiment as a ribbon, revealing trend strength and potential reversals. GMMA is widely used in <a href="/market/stocks" class="text-primary hover:underline">stock</a> and <a href="/market/forex" class="text-primary hover:underline">forex</a> markets to identify early trend participation. Set it up on <a href="/tools/platforms/tradingview" class="text-primary hover:underline">TradingView</a> and combine with the <a href="/academy/indicators/rsi" class="text-primary hover:underline">RSI</a> for timing entries.

Alligator

Bill Williams' Alligator uses three smoothed moving averages displaced forward — the Jaw, Teeth, and Lips — to identify trending and sleeping market phases with an intuitive visual metaphor. When the lines intertwine the Alligator is "sleeping" (range); when they fan out it is "eating" (trending). Combine it with the <a href="/academy/indicators/awesome-oscillator" class="text-primary hover:underline">Awesome Oscillator</a> and <a href="/academy/indicators/gator-oscillator" class="text-primary hover:underline">Gator Oscillator</a> from our <a href="/academy/indicators" class="text-primary hover:underline">indicator guide library</a> for the complete Bill Williams trading system.

Parabolic SAR — Stop and Reverse

Parabolic SAR (Stop and Reverse) plots dots above or below price to indicate trend direction and potential reversal points — it is one of the simplest trend-following indicators to use. Combine it with the <a href="/academy/indicators/adx" class="text-primary hover:underline">ADX</a> to filter out low-quality signals in ranging markets and improve your win rate. It also doubles as a dynamic trailing stop; read our <a href="/guides/use-stop-loss-orders" class="text-primary hover:underline">stop-loss guide</a> for best practices on protecting your capital. Explore more trend tools in our full <a href="/academy/indicators" class="text-primary hover:underline">indicator guide library</a>.

ALMA — Arnaud Legoux Moving Average

ALMA applies a Gaussian (bell-curve) distribution as a weight function, centred near the most recent prices, to produce a moving average that filters noise while keeping lag to a minimum. It has become a favourite on <a href="/tools/platforms/tradingview" class="text-primary hover:underline">TradingView</a> for <a href="/market/crypto" class="text-primary hover:underline">crypto</a> and <a href="/market/forex" class="text-primary hover:underline">forex</a> trend detection. Compare ALMA with other advanced moving averages like the <a href="/academy/indicators/hull-moving-average" class="text-primary hover:underline">HMA</a> in our <a href="/academy/indicators" class="text-primary hover:underline">indicator guide library</a> to find your optimal smoothing solution.

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