Define: Moving Average Envelope

Business, Legal & Accounting Glossary

Definition: Moving Average Envelope



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Full Definition of Moving Average Envelope


Moving Average Envelopes are percentage-based envelopes set above and below a moving average. The moving average, which forms the base for this indicator, can be a simple or exponential moving average.

Each envelope is then set the same percentage above or below the moving average. This creates parallel bands that follow price action.

Application of Moving Average Envelopes

With a moving average as the base, Moving Average Envelopes can be used as a trend following indicator. However, this indicator is not limited to just trend following. The envelopes can also be used to identify overbought and oversold levels when the trend is relatively flat.


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Definition Sources


Definitions for Moving Average Envelope are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 29th March, 2020