In time series analysis, a **moving average **is simply the average value of a certain number of previous periods.

An **exponential moving average **is a type of moving average that gives more weight to recent observations, which means it’s able to capture recent trends more quickly.

The following step-by-step example shows how to calculate an exponential moving average in Excel

**Step 1: Enter the Data**

First, let’s enter the following dataset that shows the total sales made by a company during 10 consecutive sales periods:

**Step 2: Calculate the Exponential Moving Average**

Next, we’ll calculate the exponential moving average (EMA) using the following formula:

EMV = [Latest Value - Previous EMA] * (2/n+1) + Previous EMA

In the formula, **n** represents the number of periods to use to calculate the exponential moving average. This is the one number that you must specify.

For our example, we’ll calculate a 3-day EMA.

First, we’ll enter the EMA value in cell **B2** to be equal to the value in cell **A2**:

Next, we’ll use the following formula to calculate the first value for the 3-day EMA:

=(A3-B2)*(2/($E$1+1))+B2

The following screenshot shows how to use this formula in practice:

Next, hover over the bottom right corner of cell **B3** until a tiny “**+**” cross appears. Double click the cross to copy and paste the formula down to the remaining cells in the column:

Column **B** now shows the 3-day exponential moving average of sales.

To calculate an exponential moving average using a different number of periods, simply change the value in cell **E1**.

For example, we could calculate the 4-day exponential moving average of sales instead by simply changing the value in cell **E1** to 4:

Column **B** now shows the 4-day exponential moving average of sales.

**Additional Resources**

The following tutorials explain how to perform other common tasks in Excel:

How to Calculate a Weighted Moving Average in Excel

How to Calculate a Cumulative Average in Excel