Exponential Moving Average (EMA) Indicator
The exponential moving average (EMA) indicator helps traders trend prices over time. It consolidates market price action into a single line by weighting recent price bar closes across a time frame. It is also common to use multiple EMAs together like a quad EMA using 8, 13, 21, and 55 bar time frames.
Using a quad EMA helps to identify levels of resistance and support. If EMAs cross up with the 8 bar EMA leading the way on top, the other EMAs will usually act as support underneath if the price falls back through. Also, be sure to use larger time frames and the corresponding EMAs. If price action on the 1 hour time frame nears EMAs on a larger time frame, expect resistance or support at those larger time frame EMA levels.
Longer EMAs, like the 50 day and 200 day, can be used to identify key pivot points like the "death cross" and "golden cross." The death cross is identified by a short term loving average like the 50 day crossing down through the longer term moving average like the 200 day. This is a signal of a potential bear market and coming down trend in the future. The golden cross is the oppose where the shorter term 50 day EMA crosses up through the longer term 200 day EMA. This is a signal of a potential bull market and coming up trend in the future.
This is the future content section for the RSI indicator and how you can use it to learn to trade cryptocurrency. It is under development!
EMA Trade Triggers
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