Waqar – Revised Edition 2

14 & 50 EMA Scalping strategy

By Waqar

What you need?

2 EMAs – 14 EMA and 50 EMA

What is an EMA?
“Exponential Moving Average” - An exponential moving average (EMA) is a type of moving average
that is similar to a simple moving average, except that more weight is given to the latest data. It's
also known as the exponentially weighted moving average.

How do I use it?

Just for a quick idea add it into any pair and just check on the 15m chart what happens whenever the
14/50 cross it makes a jump right? If the EMA spacing is big then when they cross the move is bigger

Rule of thumb:
If the 14 EMA is on top of the 50 EMA then the move will be downwards =
SELL!
If the 14 EMA is under the 50 EMA then the move will be upwards = BUY!

Things to be aware of:

- I don’t use this on gold even though it lines up at times but gold moves quicker than the
EMA’ can keep up.
- I’ve used this heavily with UJ, AJ and occasionally GJ. AUD pairs seem to work nicely too but
any other pairs I would suggest analysis and testing before taking it live.
- If watching manually then try get entries closest to the EMA. EMA bounces are common if
you go and check out the charts. Just means you get better entries and hit TP sooner 
- MOST IMPORTANT: Practice, practice and PRACTICE! Study this well and you will be
rewarded with a pip stream that occurs over and over!

Forex isn’t easy. Practice and study is key! It took me a while to master this but I had no resources, I
learnt this all manually by studying and analysing charts. Once you know how it works you will see
this as easy pips!

Go through the charts and see how commonly this movement occurs. You master it and you can
capitalise on that each and every time as I do. I compound and take 10-20 pips.

If you need more help than I’ll gladly help you. If this somehow ends in the wrong hands and you
don’t know me and you struggle….. LOL! 
Waqar – Revised Edition 2

How do I add the EMA to the charts?

There may be slight variations with MT4 platforms but it’s generally as the steps below:

 INSERT
 INDICATORS
 TREND
 MOVING AVERAGE

If using trading view then:

Right Click on chart > Insert Indicator > Type ‘EMA’ > Selecting ‘Moving Average Exponential’

Change input length to the EMA number and repeat for the second EMA.

Change style to your individual preference.

Waqar – Revised Edition 2

Examples

BUY:

14 EMA is Blue

50 EMA is Green

What to notice: Notice the gap closing between the EMA’s and the 14
starts to pull up and cross the 50 EMA. As they do it spikes up

Rule Reminder: If the 14 EMA is under the 50 EMA and forming into a
cross then buy!

SELL:

14 EMA is Blue

50 EMA is Green

What to notice: As the buy above See how the gap between the 14 &
50 begin to close. As they cross it drops.

Rule reminder: If the 14 EMA is on top of the 50 and forming into a

cross then SELL.

Here’s another example which I will run through to tell you my thought process is as I see it:
P.s the RED EMA is 200 EMA which isn’t necessary but you can use as you master this more as a TP
zone. I’ll explain later.
Waqar – Revised Edition 2

You see bigger moves on the hourly. But start with the 15min as it’s easier to predict and work on
entries. It’s also more re-occurring on the 15 min time frame. I just used this hourly as it was one I
traded and is a perfect example to explain

Example 1.

1. Before the cross even forms I see a potential buy because of the EMA placement of the
14/50
2. The wicks at the bottom reinforce my decision as its hit a solid support area and going back
up
3. As the candles bounce from the support and go up. See how the gap between the 14/50
EMA is closing?
4. See how as the gap closes further it clearly forms the indication of an incoming cross?
5. Im 100% certain it will cross so I place my buy stop at the PINK line and set a TP of 20 pips.
(TIP: You want entries above but close enough to the EMA sometimes there may be a
pullback).
6. Cross occurs and hit’s my TP and carries on going but profits are profits

TIP: If you are manually watching and following then put in a trailing stop. UJ is a volatile pair so
can move further…. You can sometimes get another entry on the pullback, but leave that to later
til you understand the concept of this strategy

If you using stops or limits then start with 10 pip TP’s as you learn this strategy,
then move to a maximum of 20 pips. Reason being don’t be greedy! You want
to use these opportunities to make them certain, successful and profitable
Waqar – Revised Edition 2

What crosses I should look for?

You want to look for crosses with clean and wide spacing.

Examples:

See how the spacing prior to cross forming is

nicely spaced. The EMA’s nicely begin to turn in
and you would be able to anticipate an
incoming cross.

What happens when they cross? It pops and

you got pips!

Set the buy limit a little over where you expect

the EMA cross and secure 10-20 pips.

Black Line is buy stop

See the spacing between the EMA’s so perfect.

Then the 14 begins to dip and just visualise how you

can foretell a nice cross is incoming. Set a sell stop just
under the cross and you got pips!
Waqar – Revised Edition 2

What crosses should I avoid?

Avoid any with EMA’s too close to each other that show indecision to which way they are heading.

This is often in consolidation periods.

You see how the EMA’s become twisted together. No

clear direction. AVOID!!!

I want you to look carefully at the example below. See how the beginning has nice spacing and could
almost fool you into thinking it may cross but then enters consolidation and the EMA’s just drift
alongside each other. This is why if I’m not at the charts I use stops and limits or if I’m watching then
I wait for the cross to nearly form.

At the end of consolidation it breaks out but no clear direction so again AVOID!!

What to be aware of for entries?

Checklist…

1. Is it a buy or sell?
2. EMA Spacing? Is it spaced enough to look solid?
3. Does it look like its heading into form a cross?
4. Buy/Sell stop
5. Did you range your TP without being greedy? KEY!!!!

Most people get stuck on the spacing bit but the examples should make sense.

MAJOR: The cross formation needs to look like an incoming collision is the simplest way to put it.
You don’t want them to look like they will brush alongside each other.

Once you can master these basics you can effectively do intra-session/day swings. Meaning bigger
pipsss! But really give it a practice and you will find this so easy to replicate everyday along with your
current trading strategy. I personally haven’t lost a trade yet since I’ve refined my practice and study
on it. I’ve been able to compound and take 10-20 pip profits on each entry, my best record is when I
was able to turn into a swing and gather 150 pipsss!!
Waqar – Revised Edition 2

Quiz
Few examples below to test you  (Answers at the bottom)

What would you do………?

Buy?? Sell?? Or Avoid??

1.

2.
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3.

4.
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ANSWERS

1. Avoid – Reason: See how it potentially looks like a buy then the EMA’s switch direction at
the end. This is why buy/sell stops work well

2. Buy – Reason: Nice decent spacing. Clearly leading into a cross. Place your buy stop just
above the cross and collect your pips

3. Avoid – Reason: Although the beginning looks like a buy but then switches. Although it still
spiked up. This is also a reason why I keep buy/sell stops at 10 Pip TP’s which JPY pairs they
are liquid enough to catch that pip count safely. The continuation of the EMA’s is so
narrowly spaced so you cannot accurately determine the direction so I would not be looking
at this set up at all.

4. Sell – Reason: Nice spacing clearly indicating a sell. As it crosses the pair drops as predicted
easy 10 pips.

If you got this all correctly then congratulations and your reward is pips for life.

If you got this wrong then go back and study practice!

Do not get overly excited when you see all the crosses when you add the EMA’s to the chart, please
take your time to practice and study!

Stay pippin’
Waqar – Revised Edition 2

Further Learning………
Some more practical examples for different timeframes and how to turn it into a swing!

TIP: Start with the 15min then move to other timeframes. Reason being the 5m may be too quick
and the 1 hour maybe too long to begin with. But I’ll explain my approach and perspective for them.

3 4

1. This is the hourly time frame.

2. Notice the breakout from consolidation and spacing between EMA’s
3. Spacing is slightly on the tight side but nevertheless still workable just be careful I setting the
buy stop.
4. Cross occurs and shoot for pips
a. If using buy stops then 10 – 20 pips per position is safely achieved
b. If you are able to you can trailing stops or just keep riding the pair til the 14 EMA is
broken. That’s at the time of writing 130 pips per position
i. For you compound kings 5 positions alone is 650 pips! And this cross
reoccurs over and over! (Tip you can close 3 and let 2 ride??)

Things to remember it’s the hourly!! So dips and rises are normal. Don’t panic!

Til a candle breaks and closes below the 14 EMA. Don’t panic!

Secure as you go. Don’t get greedy. Some people can’t even catch 10 pips!
 Waqar – Revised Edition 2

Now the more interesting 15m chart

KEY: So as we know the smaller the time frame the more key movements we spot. The higher
timeframes we see the more long lasting trend move

1
3
2

So this is exactly the same cross as the hourly however there are some notable differences. I’ll go
through them so you don’t lose your marbles or ovaries looking at those drastic looking dips at the
top.

So the basics you should notice right away!

1. Breaks out of consolidation

2. Spacing – What are the EMA positions indicating??? (If you don’t know then go right back to
beginning pfft)
3. Cross Occurs (Jumps for Joy!)
4. Pips for days!

The golden bits:

1. As compared to the hourly the entry point for the buy is lower by 10 pips!
2. After that initial candle boosting up (just under the number 3 in the picture) The next candle
closes above a previous resistance becoming a support (for you s/r fans)
3. Now you can take your pips and run or follow the 14 EMA again for more pips.
4. So from the previous pic you remember I said til the 14 EMA isn’t broken you can ride it?
Well yes you can. On the 15m TF the 50 EMA can act as the key EMA to look at. If the candle
doesn’t break and close under the EMA you are good. (Personally I still switch to the 1hr to
see if the 14 EMA gets broken or not)
Waqar – Revised Edition 2

5. As you can see above at no point does the candle break the 50 EMA. It acts as dynamic
support all the way. (Beginning to love EMA’s now??) Again you can use hourly for the peace
of mind that it hasn’t broken the 14 EMA.
6. You can add you’re support and resistance, trend lines, candle knowledge to discover more
key information.
7. You can secure more pips catching retracements if you know how to but keep life simple 
8. SECURE WHENEVER COMFORTABLE! DON’T GET GREEDY!

Another golden nugget for you: (This is EU on 15m timeframe)

Now this one is the perfect cross. Why? What’s different?

1. Spacing???
2. What do the EMA positions tell you?
3. See those wicks before the cross forms?
4. The wicks indicate support and the candles closing above
the 14 EMA even before the cross are confident signs for the
cross and a general upward move in this situation
5. I will sometimes get on that candle prior to the cross
occurring aiming for an entry on the bottom of the wick. You
get an extra 10 pips bonus like this  . Don’t enter too early.
Get that 100% certain successful entry.
Waqar – Revised Edition 2

This one is a real treat…

Now as the same example as above (which was a buy) same applies for a sell. See those candles
begin to close under the 14? My entry would be where the blue arrow points to. Get that EMA
bounce/wick entry. So the candle before the cross. Why? Because that the point the cross is near
enough certain to occur.

Now grab 10 pips, follow it down til with a trailing stop or closes above the EMA (black arrow) If you
have candle knowledge then the best place to close is where I have placed the 2 smaller black arrows.

What do you see happen after this??? Another cross (slightly messy but still works)??? After the next
cross there is yet again another cross….  that’s 3 crosses one after the other isn’t it great? See the
potential and how effective it can be? Ride a wave and pip all the way. But don’t expect this happen
all the time this was just a perfect set up, even if you just get 1-2 crosses a day be disciplined and not
greedy.

DISCLAIMER: (Repeat of some bits mentioned on the first page)

I’ve made this simple stupid and easy. But it ISN’T please practice and familiarise yourself with
this.

I’ve not used this on every pair so please study and before applying it.

I don’t use stop-loss because I’m pretty good at it  but if you want to then set a 10-20 pip stop-
loss. If you mess up the entry and it goes the wrong way don’t sit in hope waiting for a miracle.
That’s not trading that’s gambling and you are better off just donating your money to a charity for
that matter. Rule of thumb in my personal book of learning is Do not let scalps turn into swings!
Take the loss. Recompose, practice and go again. What would you rather have the headache of a
drawdown for 10-20 pips? Or just wipe the slate clean and start fresh?? Good luck and happy
pippin.
Waqar – Revised Edition 2

If you still want more then colour in this t-shirt 