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50 EMA Forex Swing Trading Strategy
This is a swing trading strategy that is very easy to implement and can be applied to any currency pairs. This system works in all timeframes. This is only effective during a trending market.
Rules for buying:
- The price must break above the 50 EMA.
- The candlestick that breaks the 50 EMA is the entry candlestick.
- Place a buy stop order 5 pips above the high of the entry candlestick.
- Place stop loss 5 pips below the low of the entry candlestick.
Rules for selling:
- The price must break below the 50 EMA.
- The candlestick that breaks the 50 EMA is the entry candlestick.
- Place a sell stop order 5 pips below the low of the entry candlestick.
- Place stop loss 5 pips above the high of the of the entry candlestick.
Trade Management:
There are options to manage and exit your position and these are:
- Moving the stop-loss to the breakeven. This option usually stops out your position.
- You can do trail stop. Just move the stop loss at the previous swing.
Advantages:
- Comprehensive
- This is good to use in a trending market.
Disadvantages:
- This is a lagging indicator. The price will already make a move before this indicator can give a signal.
- This is not good in a non-trending market.
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