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What is an 'Exponential Moving Average  EMA'
An exponential moving average (EMA) is a type of moving average that is similar to a simple moving average, except that more weight is given to the latest data. The exponential moving average is also known as "exponentially weighted moving average".
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BREAKING DOWN 'Exponential Moving Average  EMA'
This type of moving average reacts faster to recent price changes than a simple moving average. The 12 and 26day EMAs are the most popular shortterm averages, and they are used to create indicators like the moving average convergence divergence (MACD) and the percentage price oscillator (PPO). In general, the 50 and 200day EMAs are used as signals of longterm trends.
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RELATED FAQS

What is the difference between Exponential Moving Average (EMA) and Weighted Moving ...
Read about the difference between exponential moving averages and weighted moving averages, two smoothing indicators that ... Read Answer >> 
What is the difference between a simple moving average and an exponential moving ...
The only difference between these two types of moving average is the sensitivity each one shows to changes in the data used ... Read Answer >> 
Why is the Exponential Moving Average (EMA) important for traders and analysts?
Discover why chartists and technical analysts might use an exponential moving average (EMA) instead of a simple moving average ... Read Answer >> 
What are the main disadvantages of using the Exponential Moving Average (EMA)?
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