Level-up: TA/MA/Blueprint Starter

The Technical Analysis/Moving Averages/Blueprints Starter. (5min)

A sneak peak at how to do TA on any asset and how to incorporate Moving Averages into your trading blueprints. 

• SMA (Simple Moving Average) — It just takes the closing prices over the last X periods (say 20 days), adds them up, and divides by X. Every single day in that window gets exactly the same weight. Super straightforward, smooth line, but it lags a bit because old prices from 20 days ago have as much say as yesterday's price.
• EMA (Exponential Moving Average) — this one's the "smarter" cousin. It still looks back the same number of periods, but it gives way more importance to the most recent prices and exponentially less to the older ones. So when the price suddenly starts moving fast, the EMA reacts quicker and turns sooner than the SMA.

In plain English:

• SMA = "fair & balanced, but a little slow to catch up"
• EMA = "pays attention to what's happening right now, so it's snappier"

Most traders love EMAs for shorter-term stuff (like 9, 12, 21, 50 periods) because they help spot trend changes or momentum shifts earlier. The classic 200-period one is often kept as an SMA though — it's like the "big picture" long-term trend line that everyone watches (think death/golden cross stuff with the 50 & 200).

Neither is "better" overall — depends on your style. Day traders / swing traders usually lean EMA. Long-term investors or trend followers often stick with SMA for the 200.

Pro tip: Watch for the 20 EMA crossing above the 50 EMA while both are above the 200 SMA

→ that's often a strong bullish signal (momentum building in an uptrend). Opposite for shorts.

Tradingview Pinescript for showing SMA/EMA:
(cut'n'paste in Tradingview script editor, add to chart and youre golden, tweak if needed)

// © animalqdinx 20/50 EMA + 200 SMA ComboScript

//@version=6

indicator("20/50 EMA + 200 SMA Combo", shorttitle="20-50 EMA / 200 SMA", overlay=true, max_lines_count=500)

// ────────────────────────────────────────

// Inputs so you can tweak if you want

ema20_period  = input.int(20,  title="20 EMA Period",   minval=1)

ema50_period  = input.int(50,  title="50 EMA Period",   minval=1)

sma200_period = input.int(200, title="200 SMA Period",  minval=1)

ema20_color   = input.color(color.orange, title="20 EMA Color")

ema50_color   = input.color(color.blue,   title="50 EMA Color")

sma200_color  = input.color(color.purple, title="200 SMA Color")

// ────────────────────────────────────────

// Calculations

ema20  = ta.ema(close, ema20_period)

ema50  = ta.ema(close, ema50_period)

sma200 = ta.sma(close, sma200_period)

// ────────────────────────────────────────

// Plot the lines (thicker for the big one)

plot(ema20,  title="20 EMA",  color=ema20_color, linewidth=2)

plot(ema50,  title="50 EMA",  color=ema50_color, linewidth=2)

plot(sma200, title="200 SMA", color=sma200_color, linewidth=3)

// Bonus: faint background fill when price is above 200 SMA (bullish territory)

// bgcolor(ema20 > sma200 ? color.new(color.green, 95) : na, title="Above 200 SMA tint")

// Uncomment the line above if you want a light green background when price > 200 SMA

//script-endex.

// ────────────────────────────────────────

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