![]() The exponential moving average places greater importance on more recent data.ĮMA is expressed by the following equation: ![]() The common weighting method for EMA, is to add the difference between the previous average and the current price, multiplied by the smoothing factor, into the previous average. ![]() The weighting factors in an EMA is based on a smoothing factor generated from the length of the input. The most recent data gets the greatest weight and each price gets a smaller weight as the series is traversed chronologically. All moving averages typically use a historical data series and the current price in the calculation. An Exponential Moving Average or EMA assigns a weighting factor to each value in the data series based on its age. The moving average method is a commonly used technical analysis indicator.
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