Before we start to discuss about the forex faq for today, I must thank all of you who has participated in the poll of the month for the month of July 2012.
I will consolidate the result and then share with you the result in my next post. As for the month of August, we have a new poll and the topic is about the number of indicators you are using in your trading.
Do help by participating in the poll before as this information will be shared among all of us here.
Below is the question for today forex faq
What is the best 3 EMA (exclude 200 EMA) & other indicator if i want to trade using 4 hour time frame?
If you have read my article, you will have know that one of my favourite forex moving average is the 200 EMA. For those of you who did not read about it, you can read it below
Therefore if you were to ask me to recommend you 3 other moving averages to use. I have a few but it varies with the strategy you are using.
Trend Identifying Purpose – If you are planning to use these 3 EMAs to tell the trend in order for you to trade the trend strategy, I will suggest you to use the 100, 200 and 400 EMAs.
If you see them stacking one over another with good angle and separation, it is an indication of a good trend. If they are cluster together, it is a sign that the market is in consolidation.
Crossover Strategy – If you are using the moving averages to trade the crossover strategy, I will suggest you to use the 20 and 50 EMA.
For more information about the crossover strategy, you can watch the video that I have recorded below.
As for the time frame you are using, it does not matter, you can use the 100, 200 and 400 EMAs on the hourly chart, daily chart or even 15 minutes chart to tell the trend. Similarly for the crossover strategy, the 20 and 50 EMAs works on any time frame as well.
Therefore there is no restriction on which EMAs to use on what time frame.
I hope that I have answered your question. If you find this article useful, please either click on the G+1 or Facebook Like button below.