Trading might seem very complex, yet in reality it is a very simple task. Buy low, sell high. That is all a trader should be doing. But why is it that many traders seem to find it difficult to do this simple task? It might be because of all the complexity and the nuances that we add to our trading, which causes our strategies to fail. We chase after the latest and greatest shiny new trading tool. But maybe it is the simple indicators that we should be using, indicators that have been proven by time and are widely used by many traders.
The EMA Angle Forex Trading Strategy is one which uses simple indicators but uses a fresh approach in using it. It allows traders to simply follow the trading strategy and start taking trades that could yield high returns and give traders some profit.
Table of Contents
Moving Averages are probably one of the most basic indicators available to traders. It is a very simple concept of averaging out price for a certain span of time. A line is then plotted based on the average of price for each period. As time goes by, this line would also move along with the movement of price.
Moving Averages could be interpreted in different ways in order to identify trend direction. The most basic method of identifying trend direction using moving averages is by identifying the location of price in relation to a moving average. If price action is above a moving average, then the market would be considered bullish. If price is below a moving average, then the market would be considered bearish.
Another method would be through using the slope of a moving average. If the moving average is sloping up, then we consider the market bullish. If it is sloping down, then we consider the market bearish.
We could also use multiple moving averages to determine the trend. If a short-term moving average is above a longer-term moving average, then we consider the market bullish. If it is the inverse, then we consider the market bearish.
The beauty of moving averages is that it is very versatile. You could adjust its number of periods being averaged, allowing you to determine whether you would be looking at a long-term or a short-term trend. There are also many variations of moving averages with different characteristics and advantages, all of which are useful in one way or another.
EMA Angle Zero
The EMA Angle Zero indicator is an oscillating indicator which is directly related to one of the methods of identifying trend discussed above, the slope of a moving average.
EMA Angle Zero is basically a computation of the slope of an Exponential Moving Average (EMA). Moving Averages tend to slope more steeply during a trending market condition and tend to flatten out when the market is ranging or choppy. By looking at whether a moving average is sloping enough, we get to filter out trade setups that are presented during a ranging market. This greatly increases our accuracy when using this indicator in a trend following type of strategy.
The EMA Angle Forex Trading Strategy is basic crossover strategy using two moving averages which are quite popular among moving average crossover traders. The difference is that it also considers the slope of a bigger picture moving average, which allows it to filter out trades that are presented during a market which is not trending strongly enough.
To identify the strength of the trend using its slope, we will be using the EMA Angle Zero. We will only take trades when the indicator is showing a steep angle, indicating that the market could be trending strongly enough.
- Exponential Moving Average (EMA)
- Period: 21
- Color: Gold
- Simple Moving Average (SMA)
- Period: 45
- Color: Green
- EMA Period: 34
- Angle Threshold: 0.2
- Start EMA Shift: 6
Timeframe: 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 be printing positive lime green histograms indicating a bullish slope
- The 21 EMA should cross above the 45 SMA indicating a bullish crossover
- Enter a buy order on the confluence of the above conditions
- Set the stop loss a few pips below the moving averages
- Close the trade as soon as the EMA Angle Zero indicator prints a yellow histogram
Sell Trade Setup
- The EMA Angle Zero indicator should be printing negative yellow histograms indicating a bearish slope
- The 21 EMA should cross below the 45 SMA indicating a bearish crossover
- Enter a sell order on 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 lime 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. However, although it could bring in some profit, there are cases wherein this setup could result in a loss, especially when the market reverses too early or too deeply.
By adding in the EMA Angle Zero, we tend to filter out low probability trades that occur during non-trending market conditions. This greatly increases the win ratio of an already useable crossover trading strategy.
This strategy works best when combined with diagonal trendlines and channel breakouts. The entries that this strategy produces usually coincides with such price action based trading strategy.
Forex Trading Strategies Installation Instructions
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.
EMA Angle Forex Trading Strategy provides an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
Based on this information, traders can assume further price movement and adjust this strategy accordingly.
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How to install EMA Angle Forex Trading Strategy?
- Download EMA Angle Forex Trading Strategy.zip
- *Copy mq4 and ex4 files to your Metatrader Directory / experts / indicators /
- Copy tpl file (Template) to your Metatrader Directory / templates /
- Start or restart your Metatrader Client
- Select Chart and Timeframe where you want to test your forex strategy
- Right click on your trading chart and hover on “Template”
- Move right to select EMA Angle Forex Trading Strategy
- You will see EMA Angle Forex Trading Strategy is available on your Chart
*Note: Not all forex strategies come with mq4/ex4 files. Some templates are already integrated with the MT4 Indicators from the MetaTrader Platform.
Click here below to download: