Volume Weighted EMA Forex Trading Strategy


You can now download the Volume Weighted EMA Forex Trading Strategy for free on AtoZ Markets indicators gallery.

Trading strategies have two important components, the entry and the exit. For the most part, much has been said about entry strategies, and it is very important that we understand when to open a trade based on a strategy. Of course, we would not want to take trades that are low probability. However, most traders tend to forget about the second part of trading, which is equally important, the exit. Without this, it is unlikely that we could get the most out of a trade setup.

There are many profitable strategies that are hinged around being able to make as much profits from winning trades as much as possible. One type of strategy that requires this is a moving average crossover strategy. The entry isn’t the focal point of this strategy. In fact, you could use any strategy that allows you to catch big moves. For this strategy though, we will be using a crossover of the 5-period Exponential Moving Average (EMA) over a 200-period EMA.

Indicators:

  • 5-period EMA (gold)
  • 200-period EMA (green)
  • Volume_Weighted_MA: 20 & 50-period (brown)

Timeframe: any

Currency Pair: any

Trading Session: any

How to trade with Volume Weighted EMA Forex Trading Strategy

Buy (Long) Trade Setup Rules

Entry

  • The 5 EMA should cross above the 200 EMA
  • The candle should close well above the 200 EMA
  • Enter a buy market order at the close of the candle

Stop Loss

  • Set the initial stop loss below the 200 EMA; or
  • Set the stop loss below the low of the candle

Exit: Trailing Stop Loss

  • As soon as the trade is in profit, trail the stop loss in between the 20 and 50-period Volume_Weighted_MA until hit

Sell (Short) Trade Setup Rules

Entry

  • The 5 EMA should cross below the 200 EMA
  • The candle should close well below the 200 EMA
  • Enter a sell market order at the close of the candle

Stop Loss

  • Set the initial stop loss above the 200 EMA; or
  • Set the stop loss above the high of the candle

Exit: Trailing Stop Loss

  • As soon as the trade is in profit, trail the stop loss in between the 20 and 50-period Volume_Weighted_MA until hit

How to download and install an indicator

In order to install the indicator on your MT5 platform, you need to follow these steps:

  1. Click on the “Download Indicator” button located at the bottom of the screen.
  2. Save the file to your computer.
  3. Extract and move the files into the MT5>Indicator folder of the MetaTrader5 software file directory.
  4. Restart your Metatrader platform.
  5. Navigate to “Indicators.”
  6. And select the “Volume Weighted EMA Forex Trading Strategy” template to apply it on the chart.

Note: This indicator was developed by Jack. AtoZ Markets does not carry any copyrights over this trading tool.

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