EMA (Exponential Moving Average)

The EMA applies exponentially decreasing weights to older prices, making it more responsive to recent price changes than the SMA.

Declaration

function init(ctx) {
  ctx.indicator('fastEma', 'EMA', { period: ctx.p.fastLength, source: 'close' });
  ctx.indicator('slowEma', 'EMA', { period: ctx.p.slowLength, source: 'close' });
}

Options

Output

Returns a single number[] series.

Use Cases

EMA Crossover Strategy

function init(ctx) {
  ctx.indicator('fast', 'EMA', { period: 9, source: 'close' });
  ctx.indicator('slow', 'EMA', { period: 21, source: 'close' });
}

function onBar(ctx, i) {
  if (q.crossOver(ctx.ind.fast, ctx.ind.slow, i)) {
    ctx.order.market('ASSET', 1, { signal: 'buy', reason: 'ema_cross_up' });
  }
  if (q.crossUnder(ctx.ind.fast, ctx.ind.slow, i)) {
    ctx.order.close('ASSET', { signal: 'sell', reason: 'ema_cross_down' });
  }
}

Dynamic Support/Resistance

function onBar(ctx, i) {
  const close = ctx.series.close[i];
  const ema = ctx.ind.ema21[i];
  
  // Price bouncing off EMA as support
  if (close > ema && ctx.series.low[i] <= ema * 1.001) {
    ctx.order.market('ASSET', 1, { signal: 'buy', reason: 'ema_bounce' });
  }
}

Calculation

$$EMA_t = Price_t \times k + EMA_{t-1} \times (1 - k)$$

Where $k = \frac{2}{period + 1}$

Related

• SMA - Simpler, equal-weight average
• DEMA - Reduced lag with double smoothing
• TEMA - Further reduced lag with triple smoothing