This strategy is invented by a forum member name tiger-fx. It is from a Chinese community forum. According to him, he target to double the capital each year, with only making few trades within a year. Let me explain it more details here.
According to tiger-fx, we no need any indicators at all. “No MACD, no stochastic, we need nothing,” according to him. All we need is inserting one 250EMA on our chart. Apparently this is his favorite EMA too. “Go long when EMA pointing up, go long; when EMA pointing down, go short,” according to him. The time frame for this trade is using 4Hour chart.
Setup is fairly simple, we need only 2 thing:
- Open 4-hour chart.
- Insert one 250EMA
Entry and exit are fairly simple too:
Enter long when EMA pointing up, Exit when it is pointing down
vice versa for exit
Go Short when 250EMA pointing down
Why does it work?
Yes it does works. The 250EMA are actually long term moving average, but with weight putting on last candle. 250EMA on 4 hour chart basically calculate the data from the past 1000 hours (250 times 4 hours). Usually long term move will be more significant over long period of time.
Go long when 250EMA pointing up on 4Hour chart
Why it doesn’t work
Yes, it doesn’t work too! Many of the time, the 250EMA will be a flat line, where the price will move above, and far above it; or far below. Those move are big gain to be missed out.
Sometimes 250EMA just move sideway, while the price going highly above and below it
So here you go the pro and cons of the system. It does works, but not all the time. Like many other strategy there are pro and cons. There is no perfect system. Feel free to take this as basic and customize to become one of your systems.
