Studies Calculations

Exponentially Smoothed Moving Average (EMA)

Overview

What is Exponentially Smoothed Moving Average?

Based on Simple Moving Average, Exponentially Smoothed Moving Average is an exponentially weighted (as opposed to linearly weighted) moving average that assigns greater weight to the more recent action.

Formula

For the first value:

For all other values after the first:

Where Ct is the close price on day t and w is the weighting factor between 0 and 1.

Parameters

The weighting factor is a configurable input parameter.

Reference  

Murphy, John J., Technical Analysis of the Future Markets, New York Institute of Finance, New York, NY, 1986.