Are EMA’s Effective?
I remember a question from one of our students about EMA.
“Epektib ba ang EMA’s?”
EMA is exponential moving average.
Effective ba sila na indicator or tool?
Yes.
They will show you the exponential moving average price of an asset.
Kung effective ba siyang gamitin sa trading as a strategy ay I can say na you will win some with it and lose some din with it.
Most use EMA’s as dynamic support and resistance. They enter sa break ng EMA as resistance at exit sa break ng EMA as support.
One thing to keep in mind when using an EMA is that it shows the average price.
Let’s say gamit mo ay EMA9. Average price in 9 days ang ipapakita niya. Yung line na mafoform ay average ng 9 days na price.
Ang success ng EMA9 will rely heavily on sa gagawin ng price.
Important na idea yan which would dictate any entries or exits na gagawin mo.
Let me show you sa chart.
Sa left ay may entry at exit. Sa right ay may entry at exit.
Loss ang trade sa left. Over 26 percent ang gain sa right.
Anong difference?
Wala. The same EMA9 ang gamit.
Ang difference ay yung iginalaw ng price.
Kapag panay akyat ng price more than the average of 9 days ay above EMA9 yan siya.
Effective ang EMA9?
As a tool yes. Ginagawa niya ang trabaho niya.
Will you succeed in trading using EMA9?
Depende yan kung alam mo paano ang tamang trading approach.
What you do when the price is playing lang around EMA9 and what you do when the price breaks EMA9 as support can be a huge factor sa success mo.
Two users of the same tool can have a night and day na result depende sa approach nila sa trading.
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