Arnaud Legoux moving average
A moving average that weights prices along a bell curve, aiming for a smooth line that still keeps up with price.
What the ALMA is.
A moving average that uses a bell curve to decide which prices matter most.
The Arnaud Legoux moving average, or ALMA, was developed by Arnaud Legoux and Dimitrios Kouzis-Loukas in 2009. It aims to be both smooth and responsive.
Instead of weighting prices equally, or in straight steps, it weights them along a bell curve. The peak of the curve sits towards the most recent prices.
Prices near the peak count most. At the usual offset of 0.85, the newest bar still carries a large weight. The oldest prices count very little. Moving the peak and changing its width changes how the line behaves.
How it is calculated.
Three settings shape the bell curve. The custom indicator does the maths for you.
Choose the window.
The window is how many bars the average covers. The usual starting setting is 9 bars.
Place the peak with the offset.
The offset, between 0 and 1, sets where the curve peaks. At 0.85 it sits close to the newest bars, so the line stays responsive.
Set the width with sigma.
Sigma sets how wide the bell is. A larger sigma makes the curve narrower, so fewer bars carry most of the weight.
Weight and average.
Each close is multiplied by its weight from the curve. The total is divided by the sum of the weights.
Width s = window ÷ sigma
Weight of bar i = exp(−(i − m)² ÷ (2 × s²)), with i = 0 for the oldest bar
ALMA = Σ(weight × close) ÷ Σ weight
| Setting | Lower value | Higher value |
|---|---|---|
| Window | Faster, noisier line | Slower, smoother line |
| Offset | Smoother, more lag | More responsive, less smooth |
| Sigma | Wider curve, smoother line | Narrower curve, sharper line |
How to read it.
How traders use the ALMA. None of these is a signal on its own.
Direction of the line.
A rising ALMA describes upward momentum, and a falling one downward momentum. Because the line is smooth, its turns are fairly clear.
Price against the line.
Price holding above the ALMA suggests buyers led the recent move. Price below it suggests sellers did. In a sideways market, price crosses the line often, and most of those crossings mean little.
Two ALMAs.
Some traders plot a short and a long ALMA and watch where they cross, as they would with any pair of averages.
Tuning with care.
Small changes to the offset or sigma can change the line a lot. Change one setting at a time and compare the results on past charts.
Common mistakes.
Where traders new to the ALMA most often go wrong.
Tuning the settings until the past looks perfect. Settings that fit old prices exactly often fit new prices badly.
Pushing the offset close to 1 for speed. The line becomes more responsive, but also noisier.
Assuming low lag means no lag. The ALMA is still an average of past prices.
Installing a custom indicator without checking it. Different versions can use slightly different formulas or starting settings.
Using it on MetaTrader 5.
The ALMA is not one of MT5’s built-in indicators. You add it as a custom indicator on the desktop app.
Open the Toolbox.
In MetaTrader 5 for desktop, open the Toolbox window from the View menu and select the Code Base tab.
Find an ALMA.
Find an Arnaud Legoux moving average, often listed as ALMA, in the Code Base and download it. MT5 adds it to your terminal.
Add it to a chart.
Open the Navigator, find it under Indicators, and drag it onto the chart.
Check the settings.
Enter the window, offset and sigma. A window of 9, an offset of 0.85 and a sigma of 6 are the usual starting values.
Questions, answered.
What traders ask most about the Arnaud Legoux moving average.
01Who created the ALMA?
02What do the offset and sigma do?
03What are the usual settings?
04Is it built into MT5?
05Can I practise with it first?
Practise it on a demo.
Install the ALMA on a free MT5 demo and try different offsets and sigmas before you trade with real money.
Trading CFDs on a live account puts your capital at risk and you can lose money. A demo does not.