Weighted Moving Average

A weighted moving average is calculated in the same manner as a simple moving average, but uses values that are linearly weighted to ensure that the most recent values have a greater impact on the average. Weights in a weighted moving average decrease in arithmetic progression.

In an n-day WMA, the latest date has weight n, the second latest n-1,....1.

In trading, weighted moving average is more relevant for trend determination of stock prices, especially in a fast-moving market.