Linear Weighted Moving Average (LWMA) – FX Replay Guide
The Linear Weighted Moving Average (LWMA) indicator on FX Replay is a fast-reacting trend-following tool that helps you spot market shifts sooner than traditional moving averages. It assigns greater weight to more recent prices, making it more responsive to current momentum.
How to Use LWMA on FX Replay
1. Trend Detection
- An upward-sloping LWMA suggests a bullish trend.
- A downward-sloping LWMA signals bearish momentum.
- It's ideal for spotting short-term moves and trend shifts earlier.
2. Entry/Exit Strategies
- Buy Setup: When price pulls back to or slightly under the LWMA during an uptrend.
- Sell Setup: When price tests or rises just above the LWMA during a downtrend.
- You can also use crossovers (e.g., LWMA crossing over SMA) for trade entries.
3. Smart FX Replay Combinations
- Pair it with SMA or EMA for crossover strategies.
- Use LWMA as dynamic support/resistance on trending markets.
- Backtest it with custom settings using FX Replay’s simulation features to fine-tune period sensitivity.
4. Caution on Noise
- LWMA reacts fast, so it’s more sensitive in sideways markets.
- Combine with other FX Replay indicators like RSI, MACD, or Order Blocks for confirmation.
