Two-EMA Trend Filter with High-Low Channel Breakouts
Summary
The indicator combines a fast and slow closing-price EMA cross as a main-trend filter with a high-low channel breakout signal. A candle close beyond the channel produces a colored dot: white marks a potential buy and red a potential sell. The dot lines define stop-loss levels using an EMA-based high-low channel, while thicker lines mark take-profit levels based on the highest high or lowest low over a lookback window.
The author gives example settings of 89 and 144 for the fast and slow EMAs, and 89 for the stop and target calculations, and suggests using hourly or longer charts. These are stated preferences, not validated parameters. The document offers no backtest, asset selection, entry execution details, or evidence on risk-adjusted returns. It also describes a desired pending-order and trailing-stop/take-profit expert advisor as future work, rather than a feature already provided.
Key ideas
- A fast and slow closing-price EMA cross filters the main trend.
- A candle close outside a high-low channel creates a directional breakout signal.
- Colored dots indicate buy or sell signals and associated stop levels.
- Take-profit levels are based on recent extreme prices over a lookback period.
- The example settings and timeframe suggestion are not supported by performance evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.