The Guppy Multiple Moving Averages (GMMA) represents a trend-following trading strategy developed for Metatrader 4 platforms. It applies 13 Exponential Moving Averages (EMA) with different parameters for determining the market trends.
EMA is widely admired by short-term traders for its higher level of sensitivity to the recent changes in price actions. This type of moving averages gives you a better overview of the current market trend than simple or weighted moving averages.
Guppy Multiple Moving Averages Indicator for MT4 Overview
GMMA applies 3 types of Exponential Moving Averages. The lines in red color represent 3, 5, 8, 10, 12, and 15 EMAs. These moving averages are considered as fast-EMAs. On the other hand, the slow-EMAs are parameterized as 30, 35, 40, 45, 50, and 55 periods which are plotted in green color.
The blue line across the middle of the chart shows the 200-EMA level that demonstrates a long-term overview of the market trend.
Guppy Multiple Moving Averages Indicator for MT4 Explanation
The fast-EMAs jump over the slow-EMAs means it is a bullish trend of the market. For a better confirmation, make sure all the moving averages move above the 200-EMA. The 200-EMA also works well as a long-term support/resistance level of the price.
During a bearish market trend, the fast-EMAs will drop below the slow-EMAs and all the moving averages will move below the 200-EMA level. Scalpers may use slow-EMA levels as the initial stop loss area. Otherwise, the 200-EMA is a good S/L option for intraday/long-term traders.
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Guppy Multiple Moving: Buy Conditions
- The Fast-EMAs move above the Slow-EMAs
- All the moving averages move above 200-EMA
- SL below 55-EMA
- Take profit when the price drops below 15-EMA
Guppy Multiple Moving: Sell Conditions
- The fast-EMAs dive below the slow-EMAs
- All the EMAs move below the 200-EMA
- SL above the 55-EMA
- Take profit whenever the price moves above 15-EMA