If so - why - because everybody else does?
I know some things still require you to use SMA such as Bollinger Band due to its dependency on standard deviation calculations that use the SMA but if you have no real need to do so why are you doing it? People who use the simple moving average are giving money away. And, as always when I make a broad statement like that - unlike Jimmy Crack Corn Pone - I can prove it.
I built a filter that is based on the EMA 21. Then I cloned that filter and changed two lines to base it on the SMA 20, a very popular SMA. Here is the EMA 21 Filter
show stocks where close is between 15 and 35
and average volume(90) > 500000
and close > open
and close 1 day ago > open 1 day ago
and close > close 1 day ago
and close 1 day ago > ema(21) 1 day ago
and low 1 day ago < ema(21) 1 day ago
The other filter was exactly the same except ema(21) is changed to sma(20) in both lines shown.
and close 1 day ago > ma(20) 1 day ago
and low 1 day ago < ma(20) 1 day ago
The filters were back tested with everything held equal and here are the results:
EMA 21 = 61% Win Rate, 1.53 Risk/Reward, and 86% ROI.
MA 20 = 50% Win Rate, .93 Risk/Reward, and -7% ROI.
So just looking at those two results sets, which type of moving average do you think you should use? Just a thought - not actionable - unless you want to stop giving away money.