The key difference between a double exponential moving average (DEMA) and an EMA is that a DEMA is calculated using two EMAs, one for the price data and one for the smoothed data. The first EMA is calculated using the same formula as a regular EMA, with the most recent price being given the highest weight. The second EMA is then calculated using the same formula but with the first EMA serving as the price data. The DEMA is then calculated by subtracting the second EMA from the first EMA. This creates a line on the chart that is more responsive to price changes than a regular EMA but also filters out some of the noise and volatility in the market.
