Average Modified Moving Average Calculation

Summary

The document defines an Average Modified Moving Average indicator with two inputs: a calculation period and the price series to apply. Each new value combines the previous indicator value, weighted by the period minus two, with the current and prior prices, then divides the total by the period.

This recursive formula provides a smoothed price measure that incorporates two adjacent price observations alongside the prior indicator reading. The source gives no trading rules, parameter guidance, performance evidence, or comparison with other averages, so it explains the calculation rather than establishing a trading strategy. Its brief description also does not specify initialization or handling of missing prices.

Key ideas

• The indicator takes a period and an applied price series as inputs.
• Each value blends the prior indicator reading with the current and previous prices.
• The calculation is recursive and divides the weighted sum by the selected period.
• The document provides no evidence that the indicator predicts returns or improves trading results.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.