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Free Forex Indicators (MT4) , Trend Following Indicators
Double SMA Cross Indicator
By Arun Lama
Published On 2023-04-05
The Double SMA Cross Indicator is a popular technical analysis tool used by traders to identify trends in financial markets.
It is based on the concept of moving averages, which are mathematical calculations that smooth out price data and provide a clearer picture of the underlying trend.
Double SMA Cross Indicator Overview
The Double SMA Cross Indicator involves two moving averages, a fast and a slow one, with different periods.
When the fast-moving average crosses above the slow-moving average, it generates a bullish signal, indicating that the trend is up.
Conversely, when the fast-moving average crosses below the slow moving average, it generates a bearish signal, indicating that the trend is down.
Traders use the Double SMA Cross Indicator to filter out market noise and focus on the prevailing trend direction.
By following the trend, traders can increase their chances of making profitable trades and reduce their exposure to market volatility.
Double SMA Cross Indicator Explanation
The Double SMA Cross Indicator is based on two moving averages, a fast-moving average and a slow-moving average, which are plotted on the price chart.
The fast-moving average is calculated based on the closing prices over a short time period, such as 4 or 5 days.
The slow-moving average is calculated based on the closing prices over a longer time period, such as 14 or 21 days.
The two moving averages are then plotted on the price chart and used to generate trading signals.
Double SMA Cross Indicator: Buy Condition
The fast-moving average (4 days) crosses above the slow-moving average (14 days), generating a bullish signal.
The Double SMA Cross Indicator value rises above zero, confirming the bullish trend.
Also Read: RoboForex $30 Welcome Bonus
Double SMA Cross Indicator: Sell Condition
A bearish signal is produced when the fast-moving average (4-day) crosses below the slow moving average (14-day).
The value of the Double SMA Cross Indicator drops beneath zero, indicating a bearish trend.
Arun Lama
I have been actively trading the financial markets since April 2012. Besides trading with my personal money I am a technical analyst in a mutual fund that has Rs. 1 billion in assets under management. At my leisure, I love attending live music, traveling, and partying with friends.
About Trend Following System
Trend Following System's goal is to share as many Forex trading systems, strategies as possible to the retail traders so that you can make real money.
Risk Warning : Trading in the forex market is very risky. Thus, it is may not be for everyone. A highly leveraged position can work against the trader when the trade does not work as expected. Trading in the forex market can cause to lose a significant portion of the capital or all of the capital. It is crucial to learn about the trading and gain enough experience in the demo account before trading with real money. The trading strategies published on this website do not guarantee profit as the market is dynamic and unpredictable. The past performance of a strategy is not the indicative of future performance. Trend Following System will not accept any kind of liability or damage caused by trading the strategies published on this website.
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