An EMA (Exponential Moving Smooth Moving Average) is a variation of the standard moving average indicator. It provides some advantages such as that you will be able to grasp price fluctuations with much more detail.
Here, in this article, we introduce a band indicator for Metatrader 4 that can be used for stop-loss setting and target setting.
If you look at the image above, you can see that this indicator looks very much like the popular Bollinger Bands indicator. However, the EMA Band indicator is derived differently, of course. The calculation method for each line for the EMA Band is as follows:
・ Upper limit band (Line No.1) - Delta added to high EMA
・ High EMA (Line No.2) - Use high for EMA calculation
・ Low EMA (Line No.3) - Use low for EMA calculation
・ Lower limit band (Line No.4) - Tips for using delta as a low price EMA
Tips for using
- You can use it similarly like Bollinger Bands. If the EMA touches one of the bands it could be a good idea to initiate a contrarian trade as the price may have reached extreme levels and a point of reversal is near.
- Use this indicator when placing trades. For example, when placing a buy order, you may want to place a target in the upper band and a stop-loss order in the lower band.
- Periods - The periods used for calculation of the EMA
- MA_mode - The mode used for calculation of the EMA
- Delta - Used for calculation of the bands
Download the "EMA Band" MT4 Indicator for free from the button below
Do you need help with installing this indicator into MT4 for Windows or Mac OS? Our guide HERE will help you.