Best Exponential Moving Average Scalping Strategy
If you want to make profits in the world of Forex, and you want to make them today, then this five minute exponential moving average scalping strategy is for you.
Today, we are here to explain what is easily one of the most effective and beginner friendly trading strategies out there, the 3 EMA strategy for Forex scalping.
Today, you are going to learn all about moving averages, and we’re also going to teach you one of the best 5 minute scalping strategies that uses 3 exponential moving average lines to produce fast and reliable profits.
What is an Exponential Moving Average?
Before we can get to talking about Andy’s best 3 EMA trading strategy for Forex scalping, you first need to know what an EMA or exponential moving average is.
So, first off, a moving average or a simple moving average is a technical analysis tool used in many types of trading.
A moving average is calculated to identify the trend direction of a stock, currency pair, security, or anything else in between.
With a simple moving average, the closing prices of a security are added together and then divided by the number of closing prices (or periods) that were added together, thus providing you with a simple average of the closing prices over a given period.
Well, the EMA or exponential moving average places much more weight on the most recent prices used in the equation, thus being much more responsive and providing much more accurate signals for short term trading.
What is Forex Scalping?
Just so you are clear as to what this trading strategy is all about, when it comes to scalping, this is a specific type of day trading. Keep in mind that day trading or intraday trading refers to a style of trading where trades are open for a day or less. Now, when it comes to scalping, this is a very fast style of trading where traders use very short timeframes, usually no longer than 15 minutes.
In terms of Andy’s 3 exponential moving average scalping strategy, the timeframe he uses is 5 minutes. What you need to know here is that if you perform scalping trading the right way, you do stand to gain a whole lot of profits. It’s all about making a lot of small profits that add up to substantial gains over the course of a day. If done properly, this 3 EMA strategy will allow you to trade with minimal risk and maximum profit potential.
Best Exponential Moving Average Scalping Strategy
Ok, so what we are here to do right now is to take a closer look at the best five minute exponential moving average Forex scalping strategy that you can use in order to make consistent profits in a very short amount of time. As you will see from the video that we have included here, which shows you Andrew trading and profiting with this exact same trading strategy, if you can follow the simple tips and rules that he provides you with, you should be able to make some pretty decent profits no doubt. Keep in mind that you can use this strategy for any broker and trading platform.
Ok, so the first thing that you need to know here is that this is a 3 EMA strategy, or in other words, to make this strategy function, you need to have three exponential moving average lines. So, within your trading platform, go to the indicators section and select the EMA. Click on it three times in order to add three exponential moving average lines to your chart.
The next thing that you need to do is to edit all of your EMA lines. Go to their individual settings, and set the first one to input 21 and close 0, the second to input 9 and close 0, and the third line set to input 13 and close 0. Moreover, what you also need to make sure of here is that you are using a 5 minute chart, as this strategy will really only work for a five minute timeframe. If you use charts that have longer or shorter timeframes, you will get false signals.
Now, in terms of what you are looking for on your chart, you are looking for areas where the candlesticks do not touch your exponential moving average lines for at least 30 or 40 minutes. When the candlesticks are not touching the 3 EMA lines, what you are waiting for is the first candle to touch the EMA (any of the three lines) and when it does, count backwards 5 candlesticks, and out of those 5, look for the highest candle and the lowest candle.
As you can see from the video, these candles will then provide you with your entry into a trade, which in the case of the video example is a buy trade. In an upward trend, you are looking for the highest point in those 5 candles, and that will be your entry into a buy trade (when there is upward momentum). As Andrew notes in the video, you want to trade with the trend, and if you see a trend with strong momentum, then you really want to follow that trade.
Now comes the part where you will actually make money, exiting the trade. So, what you need to do here is to exit the trade at the next resistance level (if it was a buy trade) or exit the trade at the next support level (if it was a sell trade). As far as this exponential moving average Forex scalping strategy goes, this is more or less everything you need to know in order to make profits. If you are still confused, we recommend watching the tutorial video once more, as Andrew does show everything in great detail.
The Best 3 Exponential Moving Average Strategy – Final Thoughts
There you have it folks, the best 3 EMA or exponential moving average scalping strategy that can help you make quick, easy, and reliable profits when trading Forex.
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