Khalo uses **Simple Moving Averages (SMA)** for all of its calculations and for its leading indicators at the chart level. Simple Moving Averages are dependant on a series by series basis. For example, if a series, has monthly observations, then an **SMA of 6** would simply indicate **six months’ worth of data readings**.

A SMA is calculated by taking the **sum of a series of given values** chosen and then **dividing** that total figure by the number of periods in question.

**Short-Term **Averages respond quickly to changes in the series, while **Long****-Term **Averages tend to be slow to react. A **10-day Moving Average** would average out the values for the first **ten days** as the first initial data point. The next data point would drop the earliest price and add the price on **day 11** and take the average, and so on, and so on.

Likewise, a **50-day Moving Average** would accumulate enough data to average **50 consecutive days** of data on a rolling basis.

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