📊 TECHNICAL
Arnaud Legoux Moving Average (ALMA)
A Gaussian-weighted moving average created by Arnaud Legoux and Dimitrios Kouzis-Loukas in 2009 that reduces both lag and noise by shifting its weighting curve toward recent prices.
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Live Demo — Arnaud Legoux Moving Average (ALMA) applied to NIFTY 50 (illustrative)
PriceEMA(9)EMA(21)SMA(20)
What is ALMA?
Created in 2009 by Arnaud Legoux and Dimitrios Kouzis-Loukas. It applies a Gaussian weighting curve across the lookback window, shifted toward recent bars via an offset parameter, giving independent control over lag versus smoothness.
Formula
m = floor(offset*(n-1)), s = n/sigma
w(i) = exp( -((i-m)^2) / (2*s^2) )
ALMA = Sum(w(i)*Price(i)) / Sum(w(i))Parameters
| Parameter | Default | Description |
|---|---|---|
| Window (n) | 9 | Number of bars in the Gaussian window |
| Offset | 0.85 | Shifts the weighting peak toward recent or older bars |
| Sigma | 6 | Controls the width/smoothness of the curve |
| Source | Close | Price field used |
Signal Interpretation
- Price crossing ALMA is a low-lag trend signal, typically smoother than an EMA crossover.
- ALMA slope indicates short-term trend bias with less jitter than an EMA of the same window.
- A high-offset ALMA hugs recent price and reacts fast; low-offset behaves like a delayed average.
- Two ALMA lines with different windows crossing form a dual-average trend system.
Tips & Best Practices
- Increase offset toward 1 for faster response; decrease toward 0.5 for a smoother line.
- Raise sigma to smooth noise at the cost of slightly more lag.
- Good fast-average replacement for EMA where fewer whipsaws are desired.