The Triple Exponential Moving Average (TEMA) indicator was introduced in January 1994 by Patrick G. Mulloy, in an article in the ''
Technical Analysis of Stocks & Commodities'' magazine: "Smoothing Data with Faster Moving Averages"
It attempts to remove the inherent lag associated to Moving Averages by placing more weight on recent values. The name suggests this is achieved by applying a triple exponential smoothing which is not the case. The name triple comes from the fact that the value of an EMA (
Exponential Moving Average
In statistics, a moving average (rolling average or running average) is a calculation to analyze data points by creating a series of averages of different subsets of the full data set. It is also called a moving mean (MM) or rolling mean and is ...
) is triple. To keep it in line with the actual data and to remove the lag the value "''EMA of EMA''" is subtracted 3 times from the previously tripled ema. Finally "''EMA of EMA of EMA''" is added.
The formula is:
:
Because EMA(EMA(EMA)) is used in the calculation, TEMA needs 3 × period - 2 samples to start producing values in contrast to the period samples needed by a regular EMA.
The same article also introduced another EMA related indicator:
Double exponential moving average The Double Exponential Moving Average (DEMA) indicator was introduced in January 1994 by Patrick G. Mulloy, in an article in the " Technical Analysis of Stocks & Commodities" magazine: "Smoothing Data with Faster Moving Averages"
It attempts to rem ...
(DEMA)
References
{{technical analysis
Technical indicators