Data Analysis with Exponential Smoothing

Exponential smoothing is a time series analysis that omits irregular variation without take account of both seasonal variation and trend.  MS Excel provides exponential smoothing as a part of tools in Data Analysis.  The tool can predict a value based on the forecast for previous period. Exponential smoothing adjusts error in that prior prediction. It uses Constanta which is reflects the magnitude of which control how strongly the forecasts react to errors in the previous prediction. Smaller constants can result in long lags for prediction values.

How to apply exponential smothing analysis in Excel 2007? You should install add-ins of Data Analysis before.

  1. Input your data in two colomns of Excel sheet
  2. Select Data tab in the Ribbon
  3. Click  Data Analysis in analysis group,
  4. Select Exponential smoothing
  5. Input  your data cell in the Input Range
  6. Tick the Chart Output as well as Standard errors
  7. Press  OK
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