As the name suggests, the Zero Lag Moving Average indicator for Metatrader 4 works similarly to the classic moving average indicator but without lag.
The indicator is very popular and often used in various Forex strategies and systems.
In essence, the overall trend is considered bullish above the zero lag moving average while bearish below.
The indicator works equally well on all currency pairs (majors, minors, and exotic) and shows promising results if used correctly.
Free Download
Download the “ZeroLAG_MA.mq4” MT4 indicator
Indicator Example Chart (EUR/USD H1)
The image below shows the Zero Lag Moving Average Forex indicator in action on the trading chart.
Trading Signals
BUY:
- Open a buy trade when the price closes above the zero lag moving average.
- Set stop loss below technical support.
- Exit the buy trade for a predetermined profit target or wait for a sell signal.
SELL:
- Open a sell trade when the price closes below the zero lag moving average.
- Set stop loss above technical resistance.
- Exit the sell trade for a predetermined profit target or wait for a buy signal.
Download Now
Download the “ZeroLAG_MA.mq4” MT4 Indicator
Zero Lag Moving Average with Stochastic Oscillator MT4 Trading Strategy
This strategy combines the Zero Lag Moving Average (ZLMA) Indicator for identifying trend direction and trade signals, with the default Stochastic MT4 Oscillator to confirm momentum and improve entry timing.
This approach works well on 15-minute or 30-minute charts.
Chart Setup
- Timeframe: 15-minute or 30-minute charts
- Indicators: Zero Lag Moving Average (default settings), Stochastic Oscillator (14, 3, 3)
- Currency Pairs: Major pairs like EUR/USD, GBP/USD, USD/JPY
Entry Rules
- Buy Signal: When the price closes above the ZLMA line indicating an uptrend, enter a long trade only if the Stochastic Oscillator is coming out of the oversold area (crossing above 20), confirming upward momentum.
- Sell Signal: When the price closes below the ZLMA line indicating a downtrend, enter a short trade only if the Stochastic Oscillator is coming out of the overbought area (crossing below 80), confirming downward momentum.
Exit Rules
- Stop-Loss: Place a stop-loss below the recent swing low for buy trades, or above the recent swing high for sell trades.
- Take-Profit: Target a fixed pip amount or exit when the Stochastic Oscillator reaches the opposite extreme (above 80 for longs, below 20 for shorts) or when price crosses the ZLMA line in the opposite direction.
Example
On a 30-minute EUR/USD chart, if the price closes above the ZLMA and the Stochastic crosses above 20 from oversold, this confirms a strong buy signal. Enter a long trade, place your stop-loss below the recent swing low, and set a take-profit target at a suitable resistance level or when the Stochastic reaches overbought.
Additional Tips
- Use this strategy during active market hours to maximize liquidity and reduce slippage.
- Combine with volume analysis to further validate entries and exits.
- Practice proper risk management and backtest this strategy before using it live.
By combining the Zero Lag Moving Average with the Stochastic Oscillator, traders can better time entries and exits with both trend direction and momentum confirmation.
Adjustable Indicator Parameters & Settings
MA period, MA shift, MA method, colors, style
Feel free to experiment with the indicator’s various parameters and settings to develop a setup tailored to your trading style.
Technical Information
Currency Pairs: works on any currency pair
Trading Platform: developed for Metatrader 4 (MT4)
Time Frames: any
Indicator Type: moving average
Final Thoughts
The Zero Lag Moving Average (ZLMA) Indicator for MT4 is a powerful tool designed to provide traders with more responsive trend signals by minimizing the lag typically associated with traditional moving averages.
By closely tracking current price movements, the ZLMA offers timely buy and sell signals, enhancing decision-making processes.
This indicator is particularly beneficial for traders seeking to capture short-term market movements with greater accuracy.
Its versatility allows it to be used across various timeframes and currency pairs, making it adaptable to different trading strategies.
Whether used in conjunction with other indicators or as a standalone tool, the ZLMA can enhance trading decisions by providing clear and actionable signals.
