exponential smoothing

Definition

Statistical technique for detecting significant changes in data by ignoring the fluctuations irrelevant to the purpose at hand. In exponential smoothing (as opposed to in moving averages smoothing) older data is given progressively-less relative weight (importance) whereas newer data is given progressively-greater weight. Also called averaging, it is employed in making short-term forecasts. The 'wait-and-see' attitude to changes around them is the intuitive way people employ exponential smoothing in their daily living.

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