What are moving averages in options trading?

Moving averages are similar to averages we use in our daily lives and are used to identify trends. It is a popular technical indicator used in the stock analysis to predict the direction of a particular trend. Moving Averages are of two types: Simple and Exponential. Both simple and exponential are similar except for the fact that in exponential added weight is given to the latest data. An exponential average is considered to be more effective in predicting recent changes in the market. How to calculate Simple Moving Averages? Suppose you want to calculate the simple moving average closing price of SBI for last 5 days- Day SBI Closing Price 1 300 2 280 3 320 4 325 5 320