Triple Exponential Moving Average - TEMA

DEFINITION of 'Triple Exponential Moving Average - TEMA '

A technical indicator used for smoothing price and other data. It is a composite of a single exponential moving average, a double exponential moving average and a triple exponential moving average. Developed by Patrick Mulloy, the TEMA was first published in 1994.

BREAKING DOWN 'Triple Exponential Moving Average - TEMA '

The TEMA smooths price fluctuations and filters out volatility, thereby making it easier to identify trends with little lag. It is a useful tool in identifying strong, long lasting trends, but may be of limited use in range-bound markets with short term fluctuations.