EMA_With_Trend_Adjustment – a moving average with exponential smoothing and correction by its trend component.
The indicator has four configured parameters:
- Alpha – coefficient to calculate EMA;
- Beta – coefficient to calculate the trend component;
- Use Trend Adjustment – whether to use correction by trend (Yes/No);
- Applied price – price used for calculations.
Calculations:
EMATA = Alpha * Price + (1-Alpha) * (PrevEMATA + Trend) Trend = Beta * (EMATA - PrevEMATA) + (1 - Beta) * PrevTrend
where:
Price - SMA(1, Applied price)
Fig 1. Trend component is not used.
Fig. 2. Trend component is used.
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