Simple moving average crossover signals are very popular among currency traders worldwide.
This is what the Array Simple Moving Average MT4 indicator is all about.
It provides you with currency trading signals based on the crossover of 2 simple moving averages.
The system consists of a fast MA and a slow MA with different period settings. This creates the crossover trading system.
The default indicator period settings for both fast MA and slow MA can be changed from the inputs tab.
Feel free to experiment with its settings or to use it in agreement with other technical analysis tools.
Free Download
Download the “array-test-indicator.mq4” MT4 indicator
Indicator Chart (EUR/USD H1)
The EUR/USD 1-Hour chart below displays the Array Simple Moving Average Metatrader 4 Forex indicator in action.
Basic Trading Signals
Signals from the Array Simple Moving Average MT4 forex indicator are easy to interpret and go as follows:
Buy Signal: Open buy trade when the blue signal line crosses above the red signal line from below (bull trend).
Sell Signal: Open sell trade when the red signal line crosses above the blue signal line from below (bear trend).
Trade Exit: Close the open buy/sell trade when an opposite signal occurs, or use your own method of trade exit.
Array SMA + ASC Trend MT4 Day Trading Strategy
This MT4 day trading strategy combines the Array Simple Moving Average MT4 indicator and the ASC Trend MT4 indicator.
The Array SMA uses two signal lines: a blue line and a red line.
A bullish trend is identified when the blue line crosses above the red line from below, while a bearish trend occurs when the red line crosses above the blue line from below.
The ASC Trend indicator provides buy and sell signals with blue arrows for bullish entries and magenta arrows for bearish entries.
This strategy is designed for day trading on M15 and H1 charts and works best on major currency pairs with clear intraday trends.
Buy Entry Rules
- The blue signal line of the Array SMA crosses above the red signal line from below, indicating a bullish trend.
- The ASC Trend indicator displays a blue arrow, confirming the buy signal.
- Enter a long trade immediately after the blue arrow appears with trend confirmation.
- Place stop loss below the most recent swing low or below the crossover point of the SMA lines.
- Take profit at the next resistance level or set a 2:1 reward-to-risk ratio.
- Alternatively, use a trailing stop while the blue arrow remains and the SMA lines indicate a bullish trend.
Sell Entry Rules
- The red signal line of the Array SMA crosses above the blue line from below, indicating a bearish trend.
- The ASC Trend indicator displays a magenta arrow, confirming the sell signal.
- Enter a short trade immediately after the magenta arrow appears with trend confirmation.
- Place a stop loss above the most recent swing high or above the SMA crossover point.
- Take profit at the next support level or set a 2:1 reward-to-risk ratio.
- Alternatively, trail stop while the magenta arrow remains and the SMA lines indicate a bearish trend.
Advantages
- Combines trend confirmation and precise entry signals to improve accuracy.
- Clear entry and exit rules based on SMA crossovers and arrow signals.
- Adaptable for multiple major pairs, including EURUSD, GBPUSD, USDJPY, and AUDUSD.
- Effective for day trading on M15 and H1 charts.
- Reduces the risk of entering counter-trend trades by confirming both indicators.
Drawbacks
- Less effective in sideways markets with frequent SMA line crossovers causing false signals.
- Requires patience for proper alignment of the SMA crossover and ASC Trend arrow.
- Day trading requires active monitoring and fast execution to capture optimal pip movement.
- High frequency of signals on shorter time frames may lead to overtrading.
Example Case Study 1 (EURUSD M15 bullish trade)
On EURUSD M15, the blue SMA line crossed above the red line, indicating a bullish trend.
The ASC Trend indicator displayed a blue arrow at 1.1050.
A long trade was entered immediately. Stop loss was placed at 1.1035, 15 pips below.
Price moved to 1.1090, capturing 40 pips before partial profit was taken.
The blue SMA remained above the red line and the bullish trend continued, allowing an additional 20 pips gain.
Example Case Study 2 (GBPUSD H1 bearish trade)
On GBPUSD H1, the red SMA line crossed above the blue line, indicating a bearish trend.
The ASC Trend indicator displayed a magenta arrow at 1.2655.
A short trade was entered at 1.2654. Stop loss was placed at 1.2670, 16 pips above.
Price declined to 1.2605, capturing 49 pips profit.
The red SMA remained above the blue line and the magenta arrow continued to signal bearish momentum.
Strategy Tips
- Focus on trading during active market hours when liquidity and volatility are high for better day trading results.
- Wait for both the SMA crossover and ASC Trend arrow to align before entering to reduce false signals.
- Monitor support and resistance levels to improve entry and exit points.
- Use a trailing stop to secure profits as the trend continues.
- Use proper position sizing to manage risk on each trade according to your account size.
- Consider combining with a higher time frame trend analysis to filter trades in the direction of overall market bias.
- Be patient and avoid chasing trades if signals do not perfectly align on the chosen time frame.
Download Now
Download the “array-test-indicator.mq4” Metatrader 4 indicator
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: Chart pattern indicator
Customization options: Variable (fastMA, slowMA) Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: trend
