# Change From 5 Period SMA (15m)

## Understanding the Change From 5 Period SMA 15m Filter

The "Change From 5 Period SMA (15 minute)" filter in stock trading is used to compare the price of the last print for a stock to that of the 5 period simple moving average on a 15-minute chart. This filter is designed for short-term, intraday trading analysis due to its focus on small time increments. Here's how it's constructed and used:

Simple Moving Average (SMA)

5-Period SMA: This is an average of the stock's closing prices over the last 5 periods, where each period is 15 minutes long. In other words, it's the average closing price of the stock over the last 75 minutes of trading.

Dynamic Indicator: Dynamic and Responsive: The 5-period SMA on a 15-minute chart is more responsive than longer SMAs but less volatile than shorter period SMAs or those calculated on smaller timeframe charts.

Calculation: The values entered for this filter are percentage (%). The formula is (Percent Change) = ((Last Price) - (SMA)) / (SMA) * 100.

A positive number means that the current price is above the moving average. A negative number means the current price is below the moving average.

## Change From 5 Period SMA 15m Filter Settings

The settings of each Trade Ideas filter are defined in the Window Specific Filters Tab located in the Configuration Window of your Alert/Top List Window.

Here is how to setup the filter in your configuration window:

• Set the min value to 1 to see only stocks in which the current price is above their 5 period SMA on a 15 minute chart.

• Set the max value to -1 to see only stocks in which the current price is below their 5 period SMA on a 15 minute chart.

## Using the Change From 5 Period SMA 15m Filter

Several trading strategies can be employed with the Change From 5 Period SMA 15m filter. Here are a few examples:

Trend Identification: Traders use this filter to quickly determine if a stock is currently experiencing short-term upward or downward momentum, which can guide intraday trading decisions.

Momentum-Based Entries and Exits: A positive change may prompt momentum traders to take long positions, while a negative change might lead them to sell or take short positions.

Mean Reversion Strategies: If a stock deviates significantly from its 5-period SMA, some traders might anticipate a reversion to the mean and trade in the opposite direction of the deviation.

Combination with Other Indicators: To enhance its effectiveness and reduce the likelihood of false signals, this filter is often used with other technical indicators such as volume, MACD, or RSI.

## FAQs

What does it mean if the "Change From 5 Period SMA (15 minute)" value is consistently positive?

• A consistently positive value indicates that the stock price is maintaining its level above the 5-period SMA, suggesting sustained short-term upward momentum or bullish sentiment.

How should I react to a negative "Change From 5 Period SMA (15 minute)" reading?

• A negative change suggests that the stock is trading below its short-term average, indicating bearish momentum. Traders may consider this a prompt to explore selling opportunities or to wait for a trend reversal signal before buying.

How do large price spikes affect the "Change From 5 Period SMA (15 minute)"?

• Significant price spikes can cause the SMA to be less representative of the true trend. Traders should be cautious following a spike and consider looking at additional context or waiting for the SMA to stabilize.

What is a good threshold for the "Change From 5 Period SMA (15 minute)" to indicate a strong trading signal?

• There’s no one-size-fits-all threshold, as it can vary based on the stock’s volatility and overall market conditions. Traders often set their own thresholds based on backtesting and experience.