Displaced Moving Average
A moving average that has been adjusted forward or back in time in order to forecast trends. Displaced moving averages are constructed by taking the moving average and shifting it by a number of intervals, either positive or negative. If the number is negative, the displaced moving average will lag the original moving average, and if the number is positive the displaced moving average will lead the original moving average.
Investopedia Commentary
The aim behind displaced moving averages is to allow traders to center the moving average or make the displaced moving average fit better with the price movement, thereby removing some of the noise in the moving average. Some traders believe that displaced moving averages have more predictive power than basic moving averages such as simple and exponential.
Related Links
Moving Averages Tutorial
Basics of Moving Averages
Introduction To Technical Analysis
See also: Exponential Moving Average - EMA, Moving Average, Simple Moving Average - SMA, Technical Analysis
Also spelled: DMA