Anchored Momentum from Smoothed and Simple Moving Averages

Summary

Anchored Momentum is defined as the percentage difference between an exponential moving average of price and a simple moving average, normalized by the simple average. The indicator therefore compares a smoothed price series with a slower reference average and expresses the gap as a momentum-style reading. It accepts a price input, periods for the two averages, upper and lower threshold levels, and a horizontal bar shift.

The supplied default parameters set an eight-period simple average, a six-period exponential average, and symmetric thresholds around zero. The text identifies the indicator's authorship and notes that an earlier version was published in 2012. It does not explain how to interpret threshold crossings, specify entry or exit rules, or provide tests, market examples, or performance results. Consequently, it documents the calculation and adjustable inputs but does not establish a complete trading strategy or evidence that the signal is profitable.

Key ideas

• The indicator compares an exponential moving average with a simple moving average of price.
• Its output scales the difference by the simple average and expresses it as a percentage-style value.
• Users can adjust average periods, applied price, threshold levels, and chart shift.
• The document provides no trading rules or evidence of performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.