Popular indicators use by most professional and retail traders? (2025)

By Editorial Team -
Among professional and retail traders, the Moving Average (MA) is widely regarded as the most popular technical indicator. It’s simple, versatile, and effective for identifying trends and potential entry or exit points. Specifically, the Simple Moving Average (SMA) and Exponential Moving Average (EMA) are the two most common variants. The 50-day and 200-day SMAs are especially popular for spotting long-term trends, while shorter EMAs, like the 20-day or 9-day, are favoured for quicker, more responsive signals in active trading.

Why it’s so popular? It smooths out price noise, works across all markets—stocks, forex, crypto, you name it—and can be adapted to any timeframe. Beginners love it for its straightforwardness, while pros combine it with other tools like RSI or MACD for more robust strategies. Ever heard of the “golden cross” or “death cross”? Those are Moving Average crossovers that traders swear by for big moves.



Hourly, daily or weekly charts?


The popularity of Moving Averages spans all timeframes—hourly, daily, or weekly—depending on the trader’s style. For retail traders, daily charts are often the go-to, especially the 50-day and 200-day SMAs, since they’re widely watched and fit swing trading or longer-term plays. Pros like hedge fund managers or institutional traders might lean toward daily or weekly charts for strategic moves, using those same 50- and 200-period SMAs to track macro trends. Meanwhile, day traders—both retail and pro—love hourly or even shorter timeframes (like 15-minute charts) with faster EMAs, say 9 or 20 periods, to catch intraday swings.

It really boils down to the trading horizon. Scalpers might use a 5-minute chart with a 10-EMA, while a position trader might stick to a weekly 200-SMA. Across the board, though, Moving Averages stay king because they adapt so well.

Source: https://www.quantifiedstrategies.com/indicators-for-technical-analysis/

Note: A research paper published by The Journal of Wealth Management, February 2009; by Mebane T. Faber; A Quantitative Approach to Tactical Asset Allocation:

…A simple moving average timing model is tested since 1900 on the United States equity market before testing since 1973 on other diverse and publicly traded asset class indices, including the Morgan Stanley Capital International EAFE Index (MSCI EAFE), Goldman Sachs Commodity Index (GSCI), National Association of Real Estate Investment Trusts Index (NAREIT), and United States government 10-year Treasury bonds…

…In deciding on what logic to base this system on, there are a few criteria that are necessary for this model to be simple enough for investors to follow, and mechanical enough to remove emotion and subjective decision-making…

The system is as follows:
  • BUY RULE: Buy when monthly price > 10-month SMA.
  • SELL RULE: Sell and move to cash when monthly price < 10-month SMA.
For those of you who are interested to optimize the strategy, you could use the 200 daily simple moving average.

FAQs

Q: Should I buy now?

A: If the price is high, sell if you have a lot. If the price is low, buy if you have little. 'Buy the dip' and 'sell the rip'. If the price falls below your support line (depending on your trading style e.g. 200 SMA), stop buying. For beginners, its better to start from a long term perspective. Close positions if price close below support line (support at 200 DMA (daily moving average)).

Q: If the price is high or the price is trending up, should I buy?

A: Buy if you have little or buy during the dip. Sell half if your positions are more than your pre-allocated percentage for your portfolio. Hold your positions unless you really need the cash.

Q: If the price is trending down, should I sell?

A: You could close positions if price close below support line (support at 200 DMA (daily moving average)) or exponential moving average. 


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