What Is Triple Exponential Average (TRIX)?

The triple exponential average (TRIX) is a momentum indicator used by technical traders that shows the percentage change in a moving average that has been smoothed exponentially three times. The triple smoothing of moving averages is designed to filter out price movements that are considered insignificant or unimportant. TRIX is also implemented by technical traders to produce signals that are similar in nature to the moving average convergence divergence (MACD).

Understanding Triple Exponential Average (TRIX)

Developed by Jack Hutson in the early 1980s, the triple exponential average (TRIX) has become a popular technical analysis tool to aid chartists in spotting diversions and directional cues in stock trading patterns. Although many consider TRIX to be very similar to MACD, the primary difference between the two is that 澳洲幸运5官方开奖结果体彩网:TRIX outputs are smoother due to the triple smoothing of the 澳洲幸运5官方开奖结果体彩网:exponential moving average (EMA).

As a powerful 澳洲幸运5官方开奖结果体彩网:oscillator indicator, TRIX can be used to identify oversold and overbought markets, and it can also be used as a momentum indicator. Like many oscillators, TRIX oscillates around a zero line. When it is used as an oscillator, an extreme positive value indicates an overbought market while an extreme negative value indicates an overs🌄old market.

When TRI🍸X is used as a momentum indicator, a positive value suggests momentum is increasing, while a negative value suggests momentu🐬m is decreasing. Many analysts believe that when the TRIX crosses above the zero line, it gives a buy signal, and when it closes below the zero line, it gives a sell signal. Also, any divergence between price and TRIX can indicate significant turning points in the market.

Calculating TRIX

𓂃 🐼First, the exponential moving average of a price is derived from the expression:

$\begin{aligned} &EMA1(i)=EMA(\text{Price}, N, 1)\\ &\textbf{where:}\\ &\text{Price}(i)=\text{ Current price}\\ &\begin{aligned} EMA1(i)=&\text{ The current value of the Exponential}\\ &\text{ Moving Average}\end{aligned} \end{aligned}$​EMA1(i)=EMA(Price,N,1)where:Price(i)= Current priceEMA1(i)=​ The 🉐current value of the Exponential Moving Average​​

Next, the second smoothing of the obtained average is executed—double ex🥂ponential smoothing:

$EMA2(i)=EMA(EMA1,N,i)$EMA2(i)=EMA(EMA1,N,i)

The double exponential moving average is smoothed exponentially one more ti🌸me—hence, the triple exponential average:

$EMA3(i)=EMA(EMA2,N,i)$EMA3(i)=EMA(EMA2,N,i)

Now the indicator itself is found with:

$TRIX(i)=\frac{EMA3(i)-EMA3(i-1)}{EMA3(i-1)}$TRIX(i)=EMA3(i−1)EMA3(i)−EMA3(i−1)​