Whether you are using the 50day, 100day or 200day moving average, the method of calculation and the manner in which the moving average is interpreted remain the same. A moving average is simply an arithmetic mean of a certain number of data points. The only difference between a 50day moving average and a 200day moving average is the number of time periods used in the calculation. The 50day moving average is calculated by summing up the past 50 data points and then dividing the result by 50, while the 200day moving average is calculated by summing the past 200 days and dividing the result by 200. (To learn more, see our Moving Averages tutorial.)
As the question implies, many technical traders use these averages as an aid in choosing where to enter or exit a certain position, which then causes these levels to act as strong support or resistance. Simple moving averages (SMA) are often viewed as a lowrisk area to place transactions, since they correspond to the average price that all traders have paid over a given time frame. For example, a 50day moving average is equal to the average price that all investors have paid to obtain the asset over the past 10 trading weeks (that is, over the past two and a half months), making it a commonly used support level. Similarly, the 200day moving average represents the average price over the past 40 weeks, which is used to suggest a relatively cheap price compared to the price range over most of the past year. Once the price falls below this average, it may act as resistance because individuals who have already taken a position may consider closing the position to ensure that they do not suffer a large loss.
Critics of technical analysis say that moving averages act as support and resistance because so many traders use these indicators to inform their trading decisions. For more on this debate, see Can technical analysis be called a selffulfilling prophecy?

Are exponential moving averages more effective than simple or weighted moving averages?
Learn about different types of moving averages, as well as moving average crossovers, and understand how they are used in ... Read Answer >> 
What is the difference between a simple moving average and an exponential moving ...
The only difference between these two types of moving average is the sensitivity each one shows to changes in the data used ... Read Answer >> 
How are moving averages used in trading?
Moving averages are very popular tools used by technical traders to measure momentum. The main purpose of these averages ... Read Answer >> 
What are the main advantages of using Moving Averages (MA)?
See why moving averages have proven to be advantageous for traders and analysts and useful when applied to price charts and ... Read Answer >> 
How is a simple moving average calculated?
Learn about the simple moving average, how the indicators are used, and how to calculate a stock's simple moving average ... Read Answer >> 
What's the difference between moving average and weighted moving average?
Moving averages are one of the most popular tools used by active traders to measure momentum. In this FAQ, we'll take a look ... Read Answer >>

Active Trading Fundamentals
Simple Moving Averages Make Trends Stand Out
The moving average is easy to calculate and, once plotted on a chart, is a powerful visual trendspotting tool. 
Trading Strategies
Technical Analysis: Moving Averages
By Cory Janssen, Chad Langager and Casey MurphyMost chart patterns show a lot of variation in price movement. This can make it difficult for traders to get an idea of a security's overall trend. ... 
Active Trading
Moving Averages: Factors To Consider
By Casey Murphy, Senior Analyst ChartAdvisor.com Data Used in Calculation Most moving averages take the closing prices of a given asset and factor them into the calculation. We thought it would ... 
Active Trading
Moving Averages: How To Use Them
By Casey Murphy, Senior Analyst ChartAdvisor.com Some of the primary functions of a moving average are to identify trends and reversals, measure the strength of an asset's momentum and determine ... 
Term
What's a Death Cross?
A death cross is seen when the shortterm moving average of a security or index falls below its longterm moving average. 
Chart Advisor
4 LongTerm Buy Signs
Check out four stocks that saw the 50day cross the 200day moving average. 
Technical Indicators
Use Moving Averages to Buy Stocks
A moving average constantly updates a stock's average price, but it cannot predict a stock's performance. 
Chart Advisor
REITs Testing An Important Benchmark
These stocks are struggling to move above the nearby 50day moving averages. This group of companies might be set to move lower. 
Active Trading
Moving Averages: Strategies
By Casey Murphy, Senior Analyst ChartAdvisor.com Different investors use moving averages for different reasons. Some use them as their primary analytical tool, while others simply use them as ... 
Active Trading
The 7 Pitfalls Of Moving Averages
While moving averages can be a valuable tool, they are not without risk. Discover the pitalls and how to avoid them.

Simple Moving Average  SMA
A simple, or arithmetic, moving average that is calculated by ... 
Linearly Weighted Moving Average
A type of moving average that assigns a higher weighting to recent ... 
Exponential Moving Average  EMA
A type of moving average that is similar to a simple moving average, ... 
Average Price
1. A representative measure of a range of prices that is calculated ... 
Displaced Moving Average
A moving average that has been adjusted forward or back in time ... 
Death Cross
A crossover resulting from a security's longterm moving average ...