03 — Moving Averages

Weighted Moving Average#

✓ Mathematical
◆ The PatternAssigns linearly increasing weights to recent prices — the most recent gets weight N, the previous N−1, etc.

The Weighted Moving Average assigns linearly increasing weights to more recent prices.

WMA = (N·Cₙ + (N−1)·Cₙ₋₁ + … + 1·C₁) / (N(N+1)/2)

The denominator is the triangle number — the sum of weights 1 + 2 + … + N.

WMA falls between SMA and EMA in responsiveness. Less common in practice than EMA, but useful when you want linear rather than exponential decay of older data.

Pattern bridge: Weighted averages assign importance by position — the same principle behind attention weights in transformers and weighted means in statistics.
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Exponential Moving Average
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