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We propose a novel algorithm, referred to as enhanced bounded correlation (EBC), that significantly reduces the number of computations required to carry out template matching based on normalized cross correlation (NCC) and yields exactly the same result as the full search algorithm. The algorithm relies on the concept of bounding the matching function: finding an efficiently computable upper bound of the NCC rapidly prunes those candidates that cannot provide a better NCC score with respect to the current best match. In this framework, we apply a succession of increasingly tighter upper bounding functions based on Cauchy-Schwarz inequality. Moreover, by including an online parameter prediction step into EBC, we obtain a parameter free algorithm that, in most cases, affords computational advantages very similar to those attainable by optimal offline parameter tuning. Experimental results show that the proposed algorithm can significantly accelerate a full-search equivalent template matching process and outperforms state-of-the-art methods.