Pullback
trading method: how to pullback using ema.
Description:
• Setup
indicator;
• Comparison
with channels and bollinger bands;
• Pullback
and entry layer movements.
Enter
two (2) Moving averages and select the following settings;
1.
Moving average exponential 5 High
2.
Moving average exponential 5 Low
Comparison
to channels and Bollinger bands (20 period: deviation 2.0)
The
concept is the same as channel buying in the lower channel and
selling in the upper channel. I will but it differs in terms of when
to buy and when to sell. Next look compared to the Bollinger band.
The
EMA 5 high and low are more similar to the bollinger band but
different fromin terms of appearance.The EMA 5 high / low has a
direct reflex with price movement while pricethe bollinger band will
bloom and shrink at times.
The
pullback movement and the entry layer
One
of the uses of this EMA 5 is for the entry layer of a trending
movement or a rally trend.
The
use of this EMA can also be associated with price action such as
candlestick pattern (pin
bar
/ shooting star, evening and morning star / engulfing).
The
things you need to master are the following;
• Trends;
• Price
must be rejected in the lower channel for uptrend and upper channel
for downtrend;
• Price
closed again on upper channel for pullback uptrend and lower channel
for pullback downtrend.
Here
I share how to identify trends and how to take advantage of these
trends by making entries on pullback trends. I'm using the EMA50
for medium term trends in H1. For an uptrend, candlestick must
be above EMA50 and for downtrend, candlestick must be below EMA50. In
addition to the EMA50, the EMA200 is also compatible.Once
the trend is identified, proceed with the understanding of
candlestick and EMA5 high / low, entry point will be created if
sufficient conditions.
Based
on the image we will create an entry based on the following two
conditions;
1.
Candle rejection is in the lower channel.
2.
Candle closed at EMA 5 high as a sign of trend pullback.
Entry
layer
Once
the market is pullback, you can open the entry layer in EMA 5 high
for purchase on the uptrend and the EMA 5 low for downtrend.
Note
that in one trend you are focusing on one entry only buy or sell
only.
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