Definition ∞ A long term moving average is a technical analysis tool that smooths out price data over an extended period to identify underlying trends. This indicator calculates the average price of an asset over a significant number of past periods, typically 50, 100, or 200 days, and plots it on a chart. It helps filter out short-term price fluctuations and provides a clearer view of the asset’s sustained direction. Traders and investors use it to identify support and resistance levels and confirm the prevailing market trend.
Context ∞ The long term moving average is widely referenced in cryptocurrency news as a key indicator of an asset’s health and potential future price movements. A price trading above a significant long term moving average often signals a bullish trend, while trading below it suggests a bearish outlook. Breaches of these averages are frequently cited as important technical events that can influence market sentiment and trading strategies.
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