Simple strategy for exponential moving average

Yours trading strategy gives you a signal to enter the market by crossing the lines stochastics, or lines MACDwhen the indicator RSI is in an overbought or oversold zone, when 2 moving averages are crossed, or a divergence appears, and so on and so forth. When do you enter the market?

Marketplace: Forex;
Currency pairs: various;
Timeframe: various;
Indicators EMA(9), Awesome Oscillator;
Strategy: intraday;
Protective orders: at the discretion of the trader.

Usually you double check visually that there is a signal on the indicator and then enter the market after the signal price bar closes. Sometimes this method is good for trading, and sometimes it's worth waiting longer before making an entry. Occasionally, moving averages that might cross, move away from each other and do not cross, and you only have to admit that the entry signal was false or close a losing trade altogether.

The same applies to stochastics lineswhich can cross many times before the price moves in a certain direction. And things like divergence is much more complicated than everything else: at what point, after determining the divergence, do you enter the market?

And now it's worth telling you about a simpler way to enter and exit the market. It makes more sense to use exponential average of the 9th period. And the entry signal is taken from the readings of other indicators. It is worth waiting until the price bar closes above that average to make a buy of the currency pair, and vice versa - a close below the average signals the sale of the currency pair. This method helps to accurately determine the entry point, so there is no doubt about entry expectations.

forex ema strategy

This strategy works for any timeframe. Some people may think that it is better to scalp the market on the 5-minute timeframe, but it successfully works on the daily charts. You can of course use the averages with periods of 5, 10 and so on. But the 9 period is more effective, as history shows. Moreover, using this average, we can determine the exit points from the market. And note that the crossing of the price bar of this average without closing on the opposite side is not taken into account. Closing a bar on this average also does not count.

forex ema strategy

In conclusion, we can add that the use of the exponential average of the 9th period cannot take place without other instruments, because it is very vulnerable to the rapid price movements in different directions. Therefore it is better to look for the zero line crossing of the lagging indicator Awesome Oscillator.

I personally believe that the use of this method can suit every trader, but only as an additional signal on timeframes from M30 to H4, when a certain market trend has already been formed. I hope this method will suit you and become an extra hint for a good and timely market entry.

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