Moving average crossover (trend following)

Setup & Indicators

  • Fast EMA: Period 10
  • Slow EMA: Period 50
  • Timeframe: H1 or H4
  • Additional filter: ATR(14) > 0.0005 for minimum volatility

Entry

  • Long: EMA10 crosses EMA50 from below and ATR indicates sufficient trend strength.
  • Short: EMA10 crosses EMA50 from above.

Exit & Trailing

  • Stop-loss: 1.5 × ATR(14) below/above the crossover point.
  • Take profit: 2 × risk (risk/reward = 1:2) or dynamically via trailing stop = 1 × ATR.

Risk Management

  • Max. risk per trade: 1–2% of account equity.
  • Position size: Choose volume so that SL distance × volume ≤ max risk.
Example chart: Moving-average crossover with EMA10/EMA50 and ATR(14)
Example chart for the moving-average crossover trend-following setup.
  • Upper panel (price with EMAs):
    • Yellow line: Close price
    • Orange line: EMA10
    • Red line: EMA50
    • ▲ Long entry, ▼ short entry, only when ATR(14) > 0.0005
  • Lower panel (ATR(14)):
    • Yellow line: ATR(14)
    • Dashed line: Minimum volatility (0.0005)

Chart Interpretation

  1. Long entry: EMA10 crosses EMA50 from below and ATR(14) is above the threshold.
  2. Short entry: EMA10 crosses EMA50 from above with sufficient volatility.
  3. Stop-loss & take profit: Based on 1.5 × ATR below/above the cross and R/R = 1:2 or ATR-based trailing.

This gives you a visual check of the setup in the H1/H4 context before applying risk management (1–2 % per trade, position sizing).

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