Moving averages on tick charts
Posted: Sat Oct 31, 2026 9:12 pm
Applying a moving average to a tick chart sounds like an upgrade, since it reacts faster. It also reacts to the quote bounce between bid and ask.
A 20-period average on a 1-tick chart is built from the last 20 quote updates, which in a calm moment might cover just a few seconds. It behaves like a noisy squiggle, not a trend line.
Tick charts with larger bars, say 100 or 200 ticks, give more stable averages. The period needs adjusting too. What works on minute bars does not transfer directly.
Using mid price reduces the bounce. So does smoothing, though that adds lag again.
The practical advice is testing, not assuming. Compare the signals from a minute-based average and a tick-based one over a few weeks of data. See whether the faster version yields better entries after costs.
Often the extra responsiveness is offset by extra false signals.
Which tick bar size gave the most stable moving average behavior?
A 20-period average on a 1-tick chart is built from the last 20 quote updates, which in a calm moment might cover just a few seconds. It behaves like a noisy squiggle, not a trend line.
Tick charts with larger bars, say 100 or 200 ticks, give more stable averages. The period needs adjusting too. What works on minute bars does not transfer directly.
Using mid price reduces the bounce. So does smoothing, though that adds lag again.
The practical advice is testing, not assuming. Compare the signals from a minute-based average and a tick-based one over a few weeks of data. See whether the faster version yields better entries after costs.
Often the extra responsiveness is offset by extra false signals.
Which tick bar size gave the most stable moving average behavior?