50 EMA Forex Swing Trading Strategy For MT4
The 50 EMA Forex Swing Trading Strategy For MT4 is a perfect example of an easy swing trading method. It can be deployed to any time chart and used to trade commodities, ETFs, stocks, or any financial instrument.
We will be using the 50 EMA to place our trade. Indeed the system is easy but you have to know the TP table for using this method. For the minute chart, TP is fixed to 30 pips. For the hourly chart, TP is 50 pips and the daily, weekly chart uses 80 pips TP. If the system is deployed to the monthly time frame TP is set to 200+ pips.
The execution is based on the bullish and bearish rejection. The 50 EMA works as an excellent SR level but its dynamic property. This means, it chances or alter the slope in response to the rate of change in the price. So, if the RCP or rate of change in price is very high, the slope in the 50 EMA will be steep, and finding the trade will be tough. But for the stable market, finding the trade is easy.
When the trend is down, the price will be making new lows below the 50 EMA. Set the sell limit order right at the 50 EMA and the stop loss for the trade is only 30 pips. This creates a small problem for those who analyze the minute chart. The RR ratio for the trade will be 1:1. This can be solved by learning the PA pattern. With the help of the PA, you can lower down the stop to 15 pips which will provide 1:2 trade setups.
When the price is well above 50 EMA, patiently wait for the retest of the 50 EMA. Buy the asset at the first retest and set the 30 pip SL. For the minute chart, you can follow the PA to mitigate the issue related to the 1:1 risk to reward ratio. But the concept of PA can be avoided by taking orders in the hourly chart only. But be cautious when the signal is created before the news. The news factors are strong catalysts that can result in a massive spike or break of the 50 EMA. Be ready to lose 20% of the time even after sticking to the standard formula of this system.
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