WMA 50 Price Cross (Trend)

Buys when price crosses above its 50-bar weighted moving average and sells when it crosses back below.

How It Works

1. Compute the 50-bar weighted moving average of the close.
2. Buy when the close crosses above the WMA — price has climbed back above its medium-term trend.
3. Sell when the close crosses back below it.

Worked example. Price closes at 102.3, up through its 50-bar WMA at 102.0 after sitting below it — buy. When a later close falls back beneath the average, the trade exits.

The Math Behind The Indicators

Everything runs on closing prices of the traded timeframe: P is a close, P_t today's close, and N counts bars — one bar is one candle of that timeframe, so 20 bars on a 1h chart is 20 hours.

Weighted Moving Average (WMA)

A moving average where newer prices count more: the latest close gets weight N, the one before N − 1, down to weight 1 for the oldest. That makes it react to a turn in price sooner than a plain average.

\[\mathrm{WMA}_N = \dfrac{N \cdot P_t + (N-1) \cdot P_{t-1} + \cdots + 1 \cdot P_{t-N+1}}{N + (N-1) + \cdots + 1}\]

Example: With N = 3 and closes 100, 102, 104 (oldest to newest): (1·100 + 2·102 + 3·104) / (1 + 2 + 3) = 616 / 6 ≈ 102.67 — pulled closer to the latest price than the plain average of 102.

Example Chart

Real Data40/ 100Composite score

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Resampled Data45/ 100Composite score

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