Trading may seem very complex, but in reality it is a very simple task. Buy low, sell high. That's all a trader should do. But why do many traders seem to find it difficult to complete this simple task? This could be due to the complexity and nuance we add to our trading, which is causing our strategies to fail. We hunt for the latest and greatest shiny new trading tool. But maybe it is the simple indicators that we should be using, indicators that have been tried and tested through time and are widely used by many traders.
The EMA Angle Forex Trading Strategy uses simple indicators but uses a new approach. It enables traders to easily follow the trading strategy and make trades that could generate high returns and bring the traders some profit.
The moving averages are probably one of the most basic indicators available to traders. It is a very simple concept to average the price over a period of time. A line is then drawn based on the average price for each period. Over time, this line would move with the price movement.
Moving averages can be interpreted in different ways to determine the direction of the trend. The most basic way of finding trend direction using moving averages is to find the location of price in relation to a moving average. When the price movement is above a moving average, the market is considered bullish. When the price is below a moving average, the market is considered bearish.
Another method would be to use the slope of a moving average. When the moving average rises, we think the market is bullish. If it goes down, we think the market is bearish.
We could also use multiple moving averages to determine the trend. When a short term moving average is above a longer term moving average, we consider the market bullish. If it is the other way around, we think the market is bearish.
The nice thing about moving averages is that they are very versatile. You can adjust the number of periods averaged to determine whether you are looking at a long-term or a short-term trend. There are also many variations of moving averages with different characteristics and benefits, all of which are useful in one way or another.
EMA Angle Zero
The EMA angle zero indicator is an oscillating indicator that is directly related to one of the methods of identifying the trend discussed above, the slope of a moving average.
The EMA angle zero is basically a calculation of the slope of an exponential moving average (EMA). The moving averages tend to drop more steeply during a trending market situation and tend to flatten out when the market is volatile or restless. By examining whether a moving average is sloped enough, we can filter out trading configurations that are presented in a sprawling market. This greatly increases our accuracy when using this indicator in a trend following strategy.
The EMA Angle Forex Trading Strategy is a basic two moving average crossover strategy that is very popular with crossover moving average traders. The difference is that it also takes into account the slope of a moving average, which can filter out trades presented in a market that is not trending enough.
To determine the strength of the trend based on its slope, we use the EMA angle zero. We will only trade when the indicator has a steep angle, which indicates that the market may be trending sufficiently.
- Exponential Moving Average (EMA)
- Simple moving average (SMA)
- EMA period: 34
- Angle threshold: 0.2
- Start EMA Shift: 6
Time window: 1-hour, 4-hour, and daily charts
Currency pairs: Major and minor pairs
Trading session: Tokyo, London and New York
Buy Trade Setup
- The EMA Angle Zero indicator should print positive light green histograms that indicate a bullish slope
- The 21 EMA should cross the 45 SMA, indicating a bullish crossover
- Place an order to buy at the confluence of the above conditions
- Set the stop loss a few pips below the moving averages
- Close the trade once the EMA Angle Zero indicator prints a yellow histogram
Sell Trade Setup
- The EMA Angle Zero indicator should print negative yellow histograms that show a decreasing slope
- The 21 EMA should fall below the 45 SMA, indicating a bearish transition
- Enter a sell order at the confluence of the above conditions
- Set the stop loss a few pips above the moving averages
- Close the trade as soon as the EMA Angle Zero indicator prints a light green histogram
This simple moving average crossover strategy is a good trend following strategy. Many traders use these moving average parameters as a crossover strategy and with good success. While this could result in some profit, there are instances when this setup can result in a loss, especially if the market reverses too soon or too deeply.
By adding the EMA angle zero, we tend to filter out low probability trades that take place in non-trending market conditions. This significantly increases the win rate of an already usable crossover trading strategy.
This strategy works best when combined with diagonal trend lines and channel breakouts. The entries that this strategy generates usually coincide with such a trading strategy based on price actions.
Forex Trading Strategy Installation Instructions
The EMA Angle Forex Trading Strategy is a combination of Metatrader 4 (MT4) indicator (s) and template.
The essence of this forex strategy is to transform the accumulated history data and trading signals.
The EMA Angle Forex Trading Strategy provides the ability to spot various peculiarities and patterns in price dynamics that are invisible to the naked eye.
Based on this information, traders can assume further price movements and adjust this strategy accordingly.
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How do I install the EMA Angle Forex Trading Strategy?
- Download EMA Angle Forex Trading Strategy.zip
- * Copy mq4 and ex4 files to your Metatrader directory / Experts / Indicators /
- Copy the tpl file (template) into your Metatrader directory / templates /
- Start or restart your Metatrader client
- Select the chart and timeframe in which you want to test your forex strategy
- Right click on your trade chart and hover over "Template".
- Move right to select the EMA Angle Forex Trading Strategy
- You will see that the EMA Angle Forex Trading Strategy is available on your chart
* Note: Not all forex strategies come with mq4 / ex4 files. Some templates are already built into the MT4 indicators of the MetaTrader platform.
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