What is SMMA?
The smoothed moving average draws a single line through price using Wilder's smoothing. It works like an exponential moving average, with each bar moving the previous value part of the way towards the new price, but it moves a smaller fraction each time. That makes it smoother and slower than an EMA of the same length. It is the same smoothing used inside RSI, ATR and ADX.
SMMA smooths price to help identify trend direction. It does not confirm trend strength or predict future prices, and it lags more than an EMA with the same setting.
How to use SMMA
- Price above or below the line. Price holding above the SMMA is read as context for an uptrend, below it for a downtrend.
- The slope. A rising line means recent prices have been above the running average. A flattening line usually means the move has stalled.
- Comparing with an EMA. An SMMA of 7 behaves roughly like an EMA of 13. If you are used to EMA lengths, expect this line to be slower for the same number.
- Period length. Shorter reacts sooner and whipsaws more; longer is smoother and later.
These are ways to read the line, not entry signals on their own.
Settings
| Setting | Default | What it changes |
|---|---|---|
| Length | 7 | Bars in the average. Lower turns sooner and whipsaws more; higher is smoother and later. Minimum 1. |
| Source | Close | Which price each bar contributes. Open, high, low and the averaged sources such as hl2 and hlc3 are also available. |
Adjust the period and price source in the indicator settings.
Calculation
The first value is the simple average of the first full window. From the next bar on, each value blends the previous one with the new price:
first value = SMA(price, 7)
SMMA = (previous SMMA * (length - 1) + price) / length
= previous SMMA + (price - previous SMMA) / lengthThis is an exponential average with a smoothing factor of 1/length, against 2/(length + 1) for an EMA. With the default length of 7, each new bar pulls the line a seventh of the way towards itself. An EMA with the same smoothing factor would need a length of 13.
Because the weights decay rather than stop, there is no fixed window after the first value. The line first appears once a full window of bars is available, on the seventh bar with the defaults.
Limitations
- It lags more than an EMA. For the same length, the smaller smoothing factor makes it slower to turn.
- Lengths are not interchangeable with EMA lengths. Using an SMMA where an EMA was intended, or the reverse, gives a noticeably different line.
- Sideways markets produce repeated crossings. With no trend to follow, price crosses the line again and again.
- The live candle moves. The current bar's value changes until that bar closes.
- It is not a strategy. On its own it carries no risk management, sizing or exit.
Frequently asked questions
It is an average that moves a fixed fraction, one divided by the length, of the way towards each new price, starting from a simple average. It is also known as Wilder's smoothing or RMA.
Both are exponential-style averages. The EMA uses a smoothing factor of 2/(length + 1) and the SMMA uses 1/length, so the SMMA is slower for the same length. An SMMA of 7 is about as slow as an EMA of 13.
Yes. The indicator declares two inputs: Length, default 7 with a minimum of 1, and Source, default close. Open the indicator's settings on the chart to change them.
Values on bars that have already closed are not revised. The current candle's value moves while that candle is live and settles when it closes. Because each value builds on the previous one from a starting average, loading older history recalculates the line and values near the start of the loaded range can shift.
RSI, ATR and ADX all use Wilder's smoothing internally. The [Williams Alligator](/library/indicator/williams-alligator) is built from three smoothed moving averages.
Use the Add to chart button at the top of this page. It opens BTC/USDT on Binance in the Altrady Charts terminal with the built-in Smoothed Moving Average already applied. On any other market, open the indicator picker on the chart and choose Smoothed Moving Average from the Moving Average group.