It’s a strategy based on Exponential moving average (EMA) only. Traders hope all are well. Today I will be presenting you a strategy that can be traded with price action. Basically if you do not have any knowledge about price action you may also trade with that. Strategy name Exponential moving average (EMA) Simple Forex Strategies. so let’s start-
First we need to fulfill the criteria of exponential moving average:
- We use two moving average one is 20 Exponential Moving Average (EMA) and another is 50 Exponential Moving Average (EMA)
- Both will be applied in close.
- We will use four hour time frame for this strategy but daily time frame also can be considered.
- At first we set up 20 EMA then similarly we can set 50 EMA.
As well think all of us can set up moving average in the chart. This is not a rocket science and hope we all can do it trading entries for by 20 EMA should crust and move up –
We need to wait to touch 20 EMA or 50 EMA for 2 times or the third time. we enter into the market.
let’s have a look on the chart here. this is your USD chart on h4 time frame.
20 EMA first crossed 50 EMA from bottom and start the trend. then we see that price first touch here.
so we are going to take a buy entry on the 3rd touch.
When the 3rd touch occur and price goes up from the moving average?
We will take an entry finally. We will take entry on this candle.
Our stop loss will be based on ATR. we use the default ATR from the indicator list. it’s not a hard job to set indicators ATR.
After setting the ATR with the default value. we need to identify the stop-loss. first we select the candle from which we took the entry.
Then find the value of ATR of that time frame. we should use double of the ATR value in here. we find the ATR value was 35 you need to ignore the decimal number just find the whole number. so we find 35 an ATR value so we need to put stop-loss on 70 pips below the candle.
Where we took entry finally with Exponential Moving Average (EMA)?
Our take profit will be 1 : 2. if we risk 70 pips. we need to put our take profit on 140 pips.
or trailing our Stop loss.
Finally you can use this strategy in any pair but major pair has low volatility. so risk can be minimized on major pair for sell please closely look on the chart.