Schaff Trend And Signal EMA Indicator For MT4
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In the image above we have a simple and sophisticated indicator known as the Schaff Trend And Signal EMA Indicator For MT4.
The Schaff Trend And Signal EMA Indicator For MT4 is not be taken lightly at all. I will be sharing some tips on how to use the Schaff Trend And Signal EMA Indicator For MT4 but let me start off explaining the inner working s of the indicator.
Some More Details
The Schaff Trend And Signal EMA Indicator For MT4 is one of those indicators that are used for for leading entry points into the market. It's a trend based indicator that uses the Exponential Moving Average (EMA ). The EMA is a better performing Moving Average compared to the normal Moving Average.
The EMA computation of the Schaff Trend And Signal EMA Indicator For MT4 places more emphasis on recent price movements to give you a more accurate feel for what might transpire in the near future for the asset. And that for me is an advantage in itself because those of you who already know men, know that I'm not one person who likes using lagging based indicators not because they aren't good 100%. It is just that I just believe it presents a lot of flaws to me that does not seem to give me the edge in the market that I which I need to to make consistent profit. Because ultimately in the game of trying to forecast future market movements, the more lagging elements your indicator is attributed with the less likely you are going to get future market predictions correct on a consistent basis! This is something that will not serve you well in the long run so have a system that is built on on leading indicators such as the Schaff Trend And Signal EMA Indicator For MT4.
On this trading note of leading indicators and leading information, I prefer using the divergence trading system or trading structure.
It has a trading structure that actually gives strong and highly probable leads as to what is going to happen in the near future of the market for the underlying asset. Divergence works best for both reversal trading and trend continuation trading.
Which brings me to my next point to show two distinctive differences between regular and hidden divergence. Regular divergence is basically for reversal trades. You just need to look for exhaustion in the market as per the divergent structure and then look for price action elements which confirms the reversal in the opposite direction. So in a an up trend, the market might be making higher highs but the oscillator such as the Schaff Trend And Signal EMA Indicator For MT4 for example, is making lower highs: that is classic regular divergence!
Now with hidden divergence it's slightly different because you looking for momentum and trend continuation instead of trend reversal! So for bullish hidden divergence what will happen is that, when the price action is making higher lows and the oscillator will make lower lows then shows there is still enough momentum in the market for the underlying trend to continue trading in the upward direction.
As for bearish hidden divergence, what validates this structure is that whilst the market is making lower highs in a down trend, the oscillator at the bottom of the chart will be making higher highs. That is a simple explanation of what bearish hidden divergence is. You may use the Schaff Trend And Signal EMA Indicator For MT4 as your oscillator for identifying and trading hidden divergence. Below, I show you an excellent example of what constitutes (visually) as bearish hidden divergence!
Above you can easily identify and understand the concept of hidden divergence for a bearish example. As you can see that the market still had enough momentum to continue trading in the direction of the down trend. Hidden divergence trading is a mighty tool to have in your trading arsenal because it empowers you to trade within a trend confidently before it loses its momentum. The after that you may start looking at regular divergence trade setups to validate the forecast for a reversal to the upside.
As I mentioned in the early parts of my post that the Schaff Trend And Signal EMA Indicator For MT4 should not be taken lightly at all. The Schaff Trend And Signal EMA Indicator For MT4 truly is a magnificent indicator to have fore forecasting near-future movements within a market.
Not just that, when you use the Schaff Trend And Signal EMA Indicator For MT4 for divergence trading, especially hidden divergence, you will be placed in a supreme position to trade hidden divergence confidently!