A Simple Moving Average (SMA) is calculated by averaging an asset's closing price over a defined rolling window — typically 50 days or 200 days. The result is a smoothed price line that filters out short-term noise, making underlying trends easier to identify.
The 50-Day SMA captures intermediate-term momentum. When a price is trading above its 50-day SMA, it signals that recent momentum is positive. When it crosses below, it signals potential weakness. The 200-Day SMA is the most widely watched long-term trend indicator. A cross of the 50-Day above the 200-Day is called a 'Golden Cross' (bullish). The reverse is called a 'Death Cross' (bearish).
On StressTest.pro, we display the distance of the current price from its 50-Day and 200-Day SMAs as a percentage. A reading of +8% vs 200-Day SMA means the price is currently 8% above its long-term trend — bullish momentum. A reading of -15% means the price is in a significant downtrend.