TRIMA (Triangular Moving Average)

The Triangular Moving Average (TRIMA) is a weighted moving average that places more weight on the middle portion of the price series and less weight on the older and most recent prices. This creates a smoother line than traditional moving averages, helping to reduce noise while maintaining responsiveness to price changes.

Formula

TRIMA = (SMA of SMA)
Where:
First SMA = Sum of n prices / n
TRIMA = SMA of the first SMA over n periods
n = number of periods

How TRIMA Works

TRIMA calculates a double smoothed moving average by applying the Simple Moving Average (SMA) twice. The triangular weighting gives more importance to the middle portion of the data, resulting in a smoother line that helps filter out market noise while still capturing significant price movements. This makes it particularly useful for identifying trends and potential reversal points in medium to long-term trading.

Trading Strategies Using TRIMA

Strategy Examples

Trade price crossovers of the TRIMA line
Use multiple TRIMA periods for trend confirmation
Look for TRIMA convergence/divergence signals
Combine with momentum indicators for timing
Use TRIMA slope changes for trend shifts

Support and Resistance

TRIMA acts as dynamic support in uptrends
Serves as resistance during downtrends
Multiple TRIMA lines create support/resistance zones
Price bounces off TRIMA indicate trend strength
Use TRIMA confluences for key levels

Trend Identification

Upward sloping TRIMA confirms uptrend
Downward sloping TRIMA indicates downtrend
TRIMA crossovers signal trend changes
Multiple timeframe analysis for trend strength
Monitor TRIMA spacing for trend momentum

Advantages and Limitations

Advantages

Smoother than traditional moving averages
Reduces false signals in choppy markets
Effective for medium to long-term trends
Provides reliable support/resistance levels

Limitations

Lags more than simple moving averages
May miss quick price reversals
Less effective in ranging markets
Requires confirmation from other indicators

Best Practices When Using TRIMA

Use multiple timeframe analysis to confirm trend signals
Combine with volume indicators for trade validation
Wait for clear crossovers before entering positions
Monitor TRIMA slope changes for trend shifts
Consider overall market conditions when interpreting signals
Use proper position sizing based on risk parameters
Look for price action confirmation at TRIMA levels
Test different TRIMA periods for your trading style
Adjust strategies based on market volatility
Use wider stops in trending markets
Scale positions based on trend strength
Document which setups work best in different conditions
Regularly review and optimize your TRIMA strategies
Be patient waiting for high-probability setups