Once the security exhibiting the above characteristics is selected the next task is to select the number of moving average periods and type of moving average. The number of periods in a moving average will depend upon the security’s volatility, trend and personal preferences. Shorter length moving averages are more sensitive and identify new trends earlier, but also give more false alarms. Longer moving averages are more reliable but less responsive, only picking up the big trends. There is no predetermined or fixed length of moving averages, but some of the more popular lengths include 21, 50, 89, 150 and 200 days as well as 10, 30 and 40 weeks. Short-term traders may look for evidence of 2-3 week trends with a 21-day moving average , while longer-term investors may look for evidence of 3-4 month trends with a 40-week moving average. You should examine how the moving average fits with the price data. If there are too many breaks, lengthen the moving average to decrease its sensitivity. If the moving average is slow to react, shorten the moving average to increase its sensitivity. In addition, you may want to try using both simple and exponential moving averages. Exponential moving averages are usually best for short-term situations that require a responsive moving average. Simple moving averages work well for longer-term situations that do not require a lot of sensitivity