Is TEMA Triple Exponential Moving Average A Good Indicator?

11 February 2018, 06:57
Ahmad Hassam

Is Triple Exponential Moving Average a good indicator?

I have written a blog post in which I have discussed how to trade with TEMA.

Before you use an indicator in your trading strategy, it is always a good thing to study it.

Study it means you should know how the indicator is calculated.

In case of TEMA we are first taking an EMA then a double EMA and then a triple EMA of price.

After that we subtract the double EMA from the EMA and add the triple EMA.

This is being done to remove the lag that we have with traditional moving averages.

But I don't think solving the lag problem is useful.

Moving averages are good support and resistance indicators.

If you try to trade moving average cross, you might get chopped by the market.

But as support/resistance lines, moving averages work excellent.

TEMA does not fulfill this role.

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