This method is similar to Browns method, but Holts Method uses different parameters than the one used in original series to smooth the trend value.

The prediction of exponential smoothing can be obtained by using two smoothing constants (with values between 0 and 1) and three equations as follows:
( 1 )
( 2 )
( 3 )

Equation (1) calculates smoothing value from the trend of the previous period added by the last smoothing value . Equation (2) calculates trend value from , , and . Finally, equation (3) (forward prediction) is obtained from trend, , multiplied with the amount of next period forecasted, m, and added to basic value .

Starting value and

There are two parameters needed to estimate exponential smoothing with Holts method, the smoothing value and the trend . To find these parameters, the least squares method is used. The estimation value for is the intercept value of linear estimation, while is the slope value.