The level changes are damped quite a bit but they do still go up and down by a few percent each match based on your results. If you're going to be using them for tournament seedings it's a good idea to damp them even more so they are more stable. The four match moving average level for a match takes the level from each match and averages it with the levels from the three previous matches to provide a heavily damped level for that point in time.
For the rankings, this four match average applies to the 4 most recent matches.