We trailed the remaining half by the 20 EMA minus 15 pips.After that, we proceed to move the stop loss to breakeven.
#BEST EMA FOR DAY TRADING PLUS#
Our first target was the entry (1.2056) plus the risk (30 pips) or 1.2086, which was hit around two and a half hours later.Set the initial stop loss 20 pips below the EMA, which was 1.2046 - 20 pips = 1.2026.We entered a trade at 1.2056, which was 10 pips above the EMA at that time (1.2046).The MACD finally crossed to positive when the price was 1.2044. However, we didn't open trade since the MACD was still negative. On March 16, 2006, the EUR/USD occasionally moved above the 20 SMA. Trail the stop by the breakeven point or at 15 pips below the 20 EMA whichever is higher.Close half the position when the first target is reached and move the stop loss to breakeven.Set the first target and make sure that it is bigger than 20 pips.Alternatively, we can set the initial stop loss at the lowest low on the chart for more aggressive trades. Set the initial stop loss 20 pips below the 20-period EMA.Enter long 10 pips above the 20-period EMA.To implement this strategy, it will be really helpful if your broker offers a platform that supports automated entries, exits, stop loss, as well as trailing stops.įor a long position, wait until the price crosses above the 20-period EMA and the MACD has crossed to positive within the last five bars (25 minutes). The position will remain open to extend our profit as much as possible until the trailing stop is triggered. In the second part, the stop loss is moved to breakeven to eliminate the risk of losing. Stop loss order is used in the first part to lock in profit. We use the default setup for the MACD which is 12-period EMA and 26-period EMA as well as 9-period EMA as the signal line. The second indicator is the MACD to confirm the momentum. The EMA places more weight on recent prices, thus it is more sensitive to price movements compared to the SMA (Simple Moving Average). On the chart, activate the two technical indicators, the first of which is the 20-period EMA (Exponential Moving Average) to help determine trends. The strategy involves the following indicators:Ī 5-minute chart is used to look for momentums in a very short term. This is a momentum strategy that aims to gain profits from changes in trend direction. The 5-minute strategy with EMA below can help you ensure the profit while simultaneously increasing it. If you are one of them, you need a solid strategy to enter and exit the market at the best possible time. These are the momentum traders quick to ride on trend reversal but quick to exit positions as well. And then there are those who will make a move upon seeing a hint of change in trend direction.
A short term trading strategy with simple indicators, the 5-minute strategy with EMA is a complete trading setup with a way of managing risks and optimizing profits from the price momentum.Įxperienced traders will wait until the setup is perfect before opening positions.
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