## What Is the Moving Average?

The** moving average** is a type of average of numbers where the time frame remains the same but the data keeps updating as new data is added.

For example, we have a list of the daily arriving customer numbers of a shop. To get the average customer number, we generally sum up the total number of customers for 7 days and then divide the sum by 7. This is the general average calculation concept.

In the case of moving average or running average, the days continue, and the number of customers keeps updating. As a result, the moving average changes too. It’s not a static value now.

## Types of the Moving Average

The moving average can be divided into 3 major types. Those are,

**Simple Moving Average****Weighted Moving Average****Exponential Moving Average**

**Simple Moving Average:** When you calculate the average data of a certain numerical value by summing them up first and then dividing, it’s called **Simple Moving Average.** You can calculate the **Simple Moving Average** in Excel using the **AVERAGE function**, or the **SUM function**.

**Weighted Moving Average:** Suppose, you want to forecast the average temperature. It is possible that the latest data can predict better than the old data. In that case, we put more weight on the recent data. Thus, calculating the moving average with weights is called the **Weighted Moving Average.**

**Exponential Moving Average:** The Exponential Moving Average is a type of moving average where more weights are given to the recent data and fewer weights for the older data.

## How to Calculate a 7-Day Moving Average in Excel: 4 Ways

### Method 1 – Use the AVERAGE Function to Calculate the 7-Day Simple Moving Average in Excel

- Insert the
**AVERAGE****function**in a cell to collate the first seven values.

`=AVERAGE(C5:C11)`

- Hit
**Enter.** - Drag down the Fill Handle. This moves the cell reference and recalculates the average for subsequent days.

**Read More: **How to Calculate Weekly Average in Excel

### Method 2 – Calculate the 7-Day Simple Moving Average in Excel Using the SUM Function

- Insert the following formula for the first result (first seven days).

`=SUM(C5:C11)/7`

- Hit Enter.
- Drag down the Fill Handle tool to the other cells to calculate the moving average.

**Read More:** How to Calculate Sum & Average with Excel Formula

### Method 3 – Find the 7-Day Weighted Moving Average in Excel

We have the following weights for the 7-day moving average formula: **0.2, 0.1, 0.1, 0.2, 0.3, 0.05,** and** 0.05,** for each day respectively. The weights must add up to 1.

- Enter the following formula for the
**Weighted Moving Average**in cell**E5**.

`=0.2*C5+0.1*C6+0.1*C7+0.2*C8 +0.3*C9+0.05*C10+0.05*C11`

- Hit Enter.
- Drag down the Fill Handle.

**Read More: **Calculate Moving Average for Dynamic Range in Excel

### Method 4 – Calculate the 7-Day Exponential Moving Average in Excel

The general formula to calculate the 7-day Exponential Moving Average (EMA) in Excel is:

`EMA = [Recent Value - Last EMA] * (2 / N+1) + Last EMA`

In the formula above, you can insert any value for the **N** (number of days) as per your recruitment.

- Enter the following formula in cell
**E5**to copy the first value of the data.

`=C5`

- Use the following formula in cell
**E6**.

`=(C6-E5)*(2/8)+E5`

- Hit Enter and drag down the Fill Handle.

## Insert a Moving Average Chart in Excel

- Select the moving average values first.
- Go to the
**Insert**tab. - Insert a
**Clustered****Column 2-D**chart.

- Click on the
**2-D**chart and go to the**Chart Design**tab**.** - Navigate to the
**Add Chart Element.** - From the drop-down menu, choose
**Trendline**. - Under the
**Trendline**, you will find the**Moving Average**. Click on it to apply.

You will get a moving average chart like the following one:

**Read More:** How to Generate Moving Average in Excel Chart

**Download the Practice Workbook**

**Related Articles**

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