Implementing exponential moving average in Java

To compute an exponential moving average, you need to keep some state around and you need a tuning parameter. This calls for a little class (assuming you're using Java 5 or later):

class ExponentialMovingAverage {
    private double alpha;
    private Double oldValue;
    public ExponentialMovingAverage(double alpha) {
        this.alpha = alpha;
    }

    public double average(double value) {
        if (oldValue == null) {
            oldValue = value;
            return value;
        }
        double newValue = oldValue + alpha * (value - oldValue);
        oldValue = newValue;
        return newValue;
    }
}

Instantiate with the decay parameter you want (may take tuning; should be between 0 and 1) and then use average(…) to filter.

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When reading a page on some mathmatical recurrence, all you really need to know when turning it into code is that mathematicians like to write indexes into arrays and sequences with subscripts. (They've a few other notations as well, which doesn't help.) However, the EMA is pretty simple as you only need to remember one old value; no complicated state arrays required.

I am having a hard time understanding your questions, but I will try to answer anyway.

1) If your algorithm found 0.25 instead of 0.36, then it is wrong. It is wrong because it assumes a monotonic increase or decrease (that is "always going up" or "always going down"). Unless you average ALL your data, your data points---as you present them---are nonlinear. If you really want to find the maximum value between two points in time, then slice your array from t_min to t_max and find the max of that subarray.

2) Now, the concept of "moving averages" is very simple: imagine that I have the following list: [1.4, 1.5, 1.4, 1.5, 1.5]. I can "smooth it out" by taking the average of two numbers: [1.45, 1.45, 1.45, 1.5]. Notice that the first number is the average of 1.5 and 1.4 (second and first numbers); the second (new list) is the average of 1.4 and 1.5 (third and second old list); the third (new list) the average of 1.5 and 1.4 (fourth and third), and so on. I could have made it "period three" or "four", or "n". Notice how the data is much smoother. A good way to "see moving averages at work" is to go to Google Finance, select a stock (try Tesla Motors; pretty volatile (TSLA)) and click on "technicals" at the bottom of the chart. Select "Moving Average" with a given period, and "Exponential moving average" to compare their differences.

Exponential moving average is just another elaboration of this, but weights the "older" data less than the "new" data; this is a way to "bias" the smoothing toward the back. Please read the Wikipedia entry.

So, this is more a comment than an answer, but the little comment box was just to tiny. Good luck.