I am trying to write a prediction algorithm for a set of temperature data. I settled on Holt-Winters since it seemed to be a simple time series prediction algorithm and I can easily code it up in python to understand what is going on with it.
When I am plotting the smoothing function as it learns this is how it looks. As you can see, it follows the original curve pretty well.
But when I try to plot a future curve for one year (365 days) -- it really falls down and dies.
And to me intuitively it makes sense why it dies like that. Because if you see the last prediction equation of Holt-Winters it really only makes use of the very very last point in both the curve smoothing and the trend smoothing. And we know that exponential smoothing has a very short memory because of the whole exponential thing.
So I am wondering how does one actually go about using Holt-Winters for prediction (specifically for 365 day seasonal data like this).
If you know of any other methods which I can look at for this domain (temperature prediction) please let me know. I come from python, so it would be very useful if you can point me to resources such as libraries etc to get the job done.