**Generalized DEMA** isn't any stand-alone indicator. It's just a combination of 2 moving averages with the possibility to modify their weight in the final indicator. First of the two indicators implied is well-known EMA (Exponential moving average). EMA as such is a very good trading tool. It can emphasize the last prices and adapt to the prevailing market conditions very fast, too.

Generalized DEMA combines the indicators mentioned above into a single one in such way so we can modify their weights in the final GDEMA.

Generalized DEMA formula looks like follows:

1. Define the weight "V"

*GDEMA = [EMA * (1 + V)] – [EMA(EMA) * V]*

Generalized DEMA becomes less agressive form of Double EMA by such modification. According to our preferences, we can choose the rate of smoothing. The usual weight settings is to 0.7. In such case the Generalized DEMA indicator consists of 70 % Double EMA and just 30 % pure EMA.

GDEMA is an interesting combination of EMA (that follows the actual market conditions very fast) with Double EMA (that is much smoother and gives less false trading signals). If your trading system uses EMA, it could be quite interesting to replace it with Generalized Double EMA. You can find out very easy whether it could be of any use to you and your trading decisions.

If you are interested in a deeper study of this technical indicator and prefer ready to serve solutions, this section may be of interest to you. There you can find all the available indicators in Excel file for download.