In this video, you will look at the moving average crossover strategy. The moving average is a popular technical indicator among the forex traders and it is available for free on your MetaTrader platform. You can use this indicator to find out an existing trend. The other way is to use a combination of two moving averages and use crossover to generate buy and sell signals. It also provides dynamic support and resistance.
Consider an example. As you can see on the daily chart, you have two moving averages added. One is the 50-day EMA. The other one is the 100-day EMA. When the 50-day EMA crosses above the 100-day EMA, then it is a buy signal. When the 50-day EMA crosses below the 100-day EMA, then it is the sell signal.
If you use this system in smaller timeframes, then you may get whipsawed as you will come across too many signals. So, adjust your timeframe according to the market conditions.