Moving average ribbon
Many moving averages of different lengths drawn together, so you see how they fan out or bunch up.
What it shows
A ribbon plots several averages at once, for example 8 EMAs from 8 to 55 bars. When they fan out in order, the trend is the same on all time scales. When they tangle, the trend is unclear.
The order of the lines, and the space between them, give a quick view of the trend's strength.
How we find it
The same code that draws it on your chart follows these steps, with the same result every time.
- Compute EMAs at lengths 8, 13, 21, 34, 55 and 89.
- Plot all lines in a gradient of one color.
- Check whether the lines are in order (shortest on top for a rise).
- Measure the spread between the shortest and longest.
Starting values: Lengths 8, 13, 21, 34, 55, 89; Type EMA. These are proposed and will be tuned on real price data before launch.
How to read it
- Lines fanning out in order means all time scales agree.
- Lines bunching or crossing means the trend is unclear.
- The distance from price to the ribbon shows how stretched price is.
Status labels you may see
| Label | What it means |
|---|---|
| In order, rising | Shortest average on top, longest at the bottom. |
| In order, falling | Shortest average at the bottom. |
| Tangled | The lines are out of order. |
What cancels it
Nothing cancels it.
What traders check next
- Whether the lines are in order.
- The width of the ribbon.
- Whether price is inside or outside it.
Limits
- Many lines can look busy.
- They all lag price.
- In sideways markets they tangle.
Try it in forecastviz
- Open any ticker and choose Moving averages → Moving average ribbon in the left menu.
- Switch between 6M, 1Y, 3Y to see how the picture changes.
- Compare with Exponential moving average and 20 and 50 average crossover on the same chart.
Questions
Why so many lines?
To see several time scales at once.
Which lengths are used?
Fibonacci numbers are common. We use 8 to 89.
Related trends
Further reading
- Murphy, Technical Analysis of the Financial Markets
- Kaufman, Trading Systems and Methods
- Achelis, Technical Analysis from A to Z
Educational only. Not financial advice, and not a price forecast. Charts are drawn by code from past price data, which may be delayed.