Short EMA crossing over long EMA
The EMA (Exponential Moving Average) Cross strategy is a popular trading strategy that involves entering the market when a faster EMA crosses above or below a slower EMA. The algorithm is designed to identify a bullish signal when the faster EMA (EMA50) crosses above the slower EMA (EMA200), and it opens a position in the direction of the crossing.
Logic of the algorithm:
- The algorithm scans the price chart for a crossover of the EMA50 (50-period Exponential Moving Average) over the EMA200 (200-period Exponential Moving Average).
- Once a crossover is identified with the EMA50 above the EMA200, the algorithm fires a bullish signal.
- The algorithm will continue to hold the bullish signal as long as the EMA50 remains above the EMA200, indicating a sustained upward trend.
Configuration:
- The configuration is pre-set to use 1-hour candles for the chart, and the algorithm recommends not going below 30-minute candles for better accuracy.
Hints💡
- For additional confirmation, traders can consider combining the EMA Cross strategy with a volume increase indicator. The increased trading volume during the occurrence of the bullish signal can provide additional confidence in the strength of the trend.