The exponential moving average is a moving average that puts an accentuation on ongoing costs. This is cultivated by weighting the moving average, so it reacts all the more rapidly to newer information. The formula that is utilized to compute an EMA includes utilizing a multiplier to modify the basic moving average.

Exponential Moving Average is similar to simple moving average, measuring trend direction over a period of time. however, where as SMA simple calculates an average of price data, EMA applies more weight to data that is more current, because of its unique calculation, EMA will follow prices more closely than a corresponding SMA.

The Exponential Moving Average, or EMA, is a technical analysis tool used in finance to evaluate the momentum of asset prices. This is done by smoothing out fluctuations in order to get a clearer picture of which way the trend is headed. The EMA is calculated by applying an exponential moving average formula to historical pricing data. It is different from the simple moving average because it weighs more recent prices higher than older ones.