To calculate the WMA, each data point in a dataset is multiplied by a specific weight. The sum of these weighted values is then divided by the sum of the weights. The formula for WMA is:
WMA = (Σ (weight_i * value_i)) / Σ (weight_i)
Where weight_i is the weight assigned to each data point, and value_i is the data point itself. This formula ensures that more relevant data points have a greater influence on the final average.
