Forex Trading Strategies With Sma (simple Moving Average) By: Kishore M

This is a system based on a simple moving average and trading the currency pair EUR/CHF on a 4 hour chart. The MACD indicator is also used to confirm the entry point along with the volatmeter. The system is based mainly on the 100 period simple moving average which serves as a support/resistance line. The SMA line can also be used later to determine exit points. The indicators used in this strategy are the 100 Period Simple Moving Average, Damiani Volatmeter set at 13, 50, 1.3, True, and the MACD set at 15,26,9.

The entry rules for this strategy are to buy or take a long trade when the price closes above the 100 SMA and the MACD histogram goes above 0 line. You can sell or take a short trade when the price closes below the 100 SMA and the MACD goes below 0. The volatmeter must also show the green line to have crossed above the white in either case. This assures you that there is actually a trend going on and it is safe to trade on the direction of the SMA.

Here is a warning to consider on this strategy. If the price bar that closes above or below the 100 SMA is more than 100 pips, don’t enter the trade. This is an extremely large move in price and you should wait for a retracement back to the SMA before you decide to enter.

For the exit of this strategy, the first positions can typically get 40 pips but a re-entry may take place on a second position and can be carried beyond the 40 pip profit into the 70 pip range. Then, if you manage to get three entries before taking profit, the last position can also have a trailing stop of its own set at breakeven.

Follow this link to a sample chart of an example: http://ifxprofits.com/article09a.jpg . The example shows a price break above the SMA and below that, the other two red circles indicate further confirmation from the volatmeter and the MACD.

Another example entry and re-entry is shown in this chart: http://ifxprofits.com/article09b.jpg . In this example, we see one entry point and four possible re-entries when the price returns to the SMA line and closes above it once again. Of course, profit taking would likely have happened before all re-entries but long term investors may choose to hold these positions and take profit later.

It is important to note, in this example, how all these price breaks are confirmed by the volatmeter and the MACD readings. A final note indicates how the second re-entry point is not confirmed by the MACD after the first candle closes above the SMA. It is only the first candle in that red circle which is tradable according to this system. However, the other candles do prove to be profitable later on, illustrating a leniency of the price movement in favor of the upward trend.

Read more: http://www.articlesnatch.com/Article/Forex-Trading-Strategies-With-Sma--simple-Moving-Average-/1813785#ixzz1fnD8pX7K
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Forex Made Easy With Simple EMA Crossover

Author: Kishore M
When Forex traders are trying to determine the general trend of a currency pair, a simple system using nothing but EMA’s as the indicators can be very useful. You can trade many pairs with this system but the GBP/USD or “cable” is especially good to trade with. It is also best to use a daily chart to determine the overall trend rather than looking at the hourly or lower.



An “EMA” refers to an exponential moving average and the price data is weighted so that the most recent price changes are given more significance. Traders like these indicators better than simple moving averages because they want to take advantage of the most recent trend and get out of the trade before it is too late. EMA’s allow you to do this and are a good way to avoid the losses that come when the market is only ranging on not trending.



This particular system uses the 5 period EMA and the 8 period EMA. You can change the settings on your platform so that you have these periods indicated with two different colors. On this chart: http://ifxprofits.com/article12.jpg , the 5 period EMA is shown in purple and the 8 period EMA is shown in orange. Instead of the daily chart, they are being used on an hourly chart but some traders like to combine the hourly and the daily trend to achieve something known as “Trend alignment.”



It is a personal preference when you decide how to determine a trend but, either way, the chart shows several examples of the kind of crossovers you will be looking for to determine the direction you want to trade. Four different crossovers on the hourly chart are shown by the arrows and you can always use these kind of crossovers to determine which direction you should enter the trade.



The numbers indicate the point at which the EMA’s crossed and this is also a strong indication that it is time to enter either in a long or a short direction. Number “1”and “3” indicate long entry points and numbers “2” and “4” indicate short entry points. Apply these periods to your EMA’s and you can be sure to get some good signals when the crossovers happen.



Of course, exit strategies are harder to determine until after you have seen the price action on the trade. The simplest method is to shoot for 60 pips of profit on a daily chart and 30 pips on an hourly chart. On the example hourly chart, each of the 4 trades could potentially take 30 pips and this is a good minimum to wait for if you use these indicators.



Of course, traders who have more patience and don’t mind a bit more risk can get in on the really big profits. Trade #1 had a potential of 170 pips! That’s not too bad for a first trade and you might have been better off to take your winnings and go out to celebrate! Good luck and happy trading.
Article Source: http://www.articleclick.com/Article/Forex-Made-Easy-With-Simple-EMA-Crossover/1533688
About the Author:
Kishore M is an expert Forex Trader who was interviewed by Bloomberg & BBC. He has trained over 100,000 forex students around the world. Watch his profitable forex trading strategy videos at: http://www.ifxprofits.com