How to Calculate Exponential Moving Average?

How do you find exponential moving average (EMA)?

EMA Calculation

Exponential moving average gives more weight to recent or latest data than the past. It is also termed as exponentially weighted moving average. Use this tutorial to learn how to calculate EMA.

Formula:
EMA = (Todays Price * k) + (Yesterday Price * (1 - k ))
Where,
k = 2 / ( No. of Days +1)

Step 1: Consider an item is sold at a current value of 80$ and the price of the item before 1 day is 60$. What is its EMA?
Given,
Today Price = 80$
Yesterday Price = 60$
No. of Days = 1

Step 2: Applying the values in the formula,
Exponential Moving Average = (80 x [2/(1+1)]) + (60 x (1- [2/(1+1)]))
= (80 x 1) + 0
= 80

Hence the exponential moving average is 80.

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