EMA Forex Trading Strategy

The EMA forex trading strategy is a day trading strategy that combines the intelligence of the Forex Analyzer Pro indicator and the Price-emas custom indicator as well. Signals for this strategy are well thought through and carefully selected through the day’s session.

Chart Setup

MetaTrader4 Indicators: Forex Analyzer Pro (default setting), price-emas.ex4 (default setting)

Preferred Time Frame(s): 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours

Recommended Trading Sessions: Any

Currency Pairs: any

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Download  The EMA Forex Trading Strategy

Buy Example (click the image for full size):

EMA-forex-trading-strategy

Fig. 1.0

Strategy

Long Entry Rules:

Initiate a buy entry when the following chart or indicator patterns are in place:

  1. The green arrow of the Forex Analyzer Pro custom indicator is aligned below price bars and points upward. This is an indication of upward price pressures and a subsequent bullish signal.
  2. The Price-emas custom indicator has its red line aligned at the outer bottom, while the green line is aligned on the outer top, following a run-up to an intersection of the price-emas lines.

Stop Loss for Long Entry: Place stop loss below the green arrow of the Forex Analyzer Pro on the key S2 level.

Exit Strategy/Take Profit for Long Entry

The following rules should inform an exit and/or take profit strategy:

  1. If the red arrow of the Forex Analyzer forms above price bars and points downward, indicates that a possible reversal is underway.
  2. If the price-emas lines intersect, an indication that volatility has dropped and price is gearing up for a reversal or possibly continuation in signal. However, it is wise to keep things safe at this point, an exit is strongly advised.
  3. Trailing stop should be adjusted upward after every resistance level breached, but if after breaking a resistance level, price begins a descend back to that level (now a support level) i.e. test the support level and breaks it, then we strongly advised an exit.

Sell Entry Rules

Initiate a sell order when the following rules or conditions have triggered:

  1. When the red arrow of the Forex Analyzer Pro custom indicator (pointing downward) forms above price bars, then it means bear pressures are developing and a sell order(s) is appropriate.
  2. If the red line of the price-emas forms at the outer top, with the green line cutting through at the outer bottom, following an intersection of the price-emas custom indicator lines – a sell order(s) should be considered.

Stop Loss for Sell Entry: Place stop loss above the red arrow of the Forex Analyzer Pro on the key R2 level.

Exit Strategy/Take Profit for Sell Entry

The following conditions or rules will define an exit and/or take profit strategy for sell position(s):

  1. The green arrow of the Forex Analyzer Pro forms below price bar pointing northward, then it means price is considering a reversal and an exit should be appropriate.
  2. Intersection of the price-emas is an indication that volatility is greatly minimized and the market is considering a possible reversal.
  3. Adjustable trailing stop to the downside should be in placed after every support level has been broke, but after breaching a support level, if price begins to ascend to that level (now a resistance level) and breaks the level, then we strongly recommend and exit.

EMA-forex-trading-strategy1

Fig. 1.1

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About The Trading Indicators

The Price-emas is a custom indicator that is built on the EMA (10), EMA (50) and EMA (200), offering trader’s trend following capabilities.

The Forex Analyzer Pro offers unique buy and sell signal via its green and red arrows respectively. Seemingly, the Forex Analyzer Pro offers support and resistance levels that can be used as critical gauges in defining trends.

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