The simple EMA Crossover Signal generates buy and sell trading signals based on the crossover of 2 exponential moving averages with different period settings.
- A buy signal occurs when the fast EMA crosses above the slow EMA from below
- A sell signal occurs when the fast EMA crosses below the slow EMA from above
The default indicator period settings are set to 5 (fast EMA) and 6 (slow EMA).
The settings above are ok if you want to scalp in the direction of the overall currency trend.
In this case, you will need to add a longer-term trend indicator to the charts and only open buy/sell positions in the direction of the overall trend.
The best trading sessions for scalping are the London and New york trading session.
Change the indicator’s period settings to for example: 5 (fast EMA) and 200 (slow EMA) if you want to use the indicator as a standalone buy/sell signals indicator.
Experiment with its period settings to suit your trading style.
The GBP/USD 1 Hour chart below displays the Simple EMA Crossover Signal Metatrader 4 Forex indicator in action.
Basic Trading Signals
Signals from the Simple EMA Crossover Signal MT4 forex indicator are easy to interpret and goes as follows:
Buy Signal: Buy when the Simple EMA Crossover Signal indicator paints a green arrow on the MT4 chart. Place a protective stop-loss a few pips below the most recent swing low.
Sell Signal: Sell when the Simple EMA Crossover Signal indicator paints a red arrow on the MT4 chart. Place a protective stop-loss a few pips above the most recent swing high.
Trade Exit : Use your own method of trade exit.
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: Chart pattern indicator
Customization options: Variable (faster EMA, slower EMA) Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Copy and paste the ema-crossover-signal.mq4 into the MQL4 indicators folder of the Metatrader 4 trading platform.
You can access this folder from the top menu as follows:
File > Open Data Folder > MQL4 > Indicators (paste here)