Moving Averages

Moving averages are tools used to analyze data trends over time by calculating the average of a set number of data points, then shifting that window forward as new data comes in. This helps smooth out short-term fluctuations, revealing the overall direction or pattern. For example, in finance, a 50-day moving average of stock prices shows the general trend without daily noise. It offers a clearer view of whether values are generally rising, falling, or stable, making it easier to make informed decisions based on data trends rather than isolated data points.