Introduction to the SMMA Crossover Signal Indicator
Moving average crossovers is one of the ways traders can objectively identify trend reversals. However, most moving average lines tend to be too susceptible to market noise and price spikes which often create false trend reversal signals.
The SMMA Crossover Signal Indicator is an attempt at a crossover signal indicator which is less susceptible to market noise.
What is the SMMA Crossover Signal Indicator?
The SMMA Crossover Signal Indicator is a trend reversal signal indicator based on the Smoothed Moving Average (SMMA).
Moving average lines are usually either too lagging or too susceptible to market noise and price spikes. The SMMA line was developed with the aim of reducing market noise by smoothening out the moving average line. This creates a moving average line that is less susceptible to false signals.
The SMMA Crossover Signal Indicator plots arrows pointing the direction of a trend reversal based on the crossing over of two SMMA lines.
How the SMMA Crossover Signal Indicator Works?
The SMMA Crossover Signal Indicator has an underlying pair of SMMA lines within its algorithm. It uses the crossing over of the underlying SMMA lines as a basis for identifying trend reversals. It plots an arrow pointing up whenever the faster SMMA lines crosses above the slower SMMA line, and an arrow pointing down whenever the faster SMMA line crosses below the slower SMMA line.
How to use the SMMA Crossover Signal Indicator for MT4
The SMMA Crossover Signal Indicator has two variables which allow traders to tweak the sensitivity of the SMMA Crossover Signal Indicator.
The “Faster SMMA” and “Slower SMMA” variables allow traders to modify the number of periods used for computing the two underlying SMMA lines. This changes the sensitivity of the signals produced by the SMMA Crossover Signal Indicator.
This indicator can be used as a trend reversal signal indicator, as it was intended to be used. However, it is best used in confluence with other trend reversal price action setups for better accuracy.
Buy Trade Setup
When to Enter?
Identify a diagonal resistance line on a downtrend market. Open a buy order on the confluence of a break above the resistance line and a bullish signal produced by the SMMA Crossover Signal Indicator. Set the stop loss on the support below the entry candle.
When to Exit?
Close the trade as soon as price action shows signs of a bearish trend reversal or as a bearish signal arrow appears.
Sell Trade Setup
When to Enter?
Identify a diagonal support line on an uptrend market. Open a sell order on the confluence of a drop below the resistance line and a bearish signal produced by the SMMA Crossover Signal Indicator. Set the stop loss on the resistance above the entry candle.
When to Exit?
Close the trade as soon as price action shows signs of a bullish trend reversal or as a bullish signal arrow appears.
Conclusion
The SMMA line was developed with the aim of reducing market noise, not decreasing lag. As such, the signal that this indicator produces can sometimes be lagging. However, this can be modified by adjusting the periods used on the underlying SMMA lines. It is also best to use the signals in confluence with price action based trend reversals.
MT4 Indicators – Download Instructions
SMMA Crossover Signal Indicator for MT4 is a Metatrader 4 (MT4) indicator and the essence of this technical indicator is to transform the accumulated history data.
SMMA Crossover Signal Indicator for MT4 provides for an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
Based on this information, traders can assume further price movement and adjust their strategy accordingly.
Recommended Forex Metatrader 5 Trading Platform
- Free $30 To Start Trading Instantly
- Deposit Bonus up to $5,000
- Unlimited Loyalty Program
- Awards Winning Trading Broker
How to install SMMA Crossover Signal Indicator for MT4.mq4?
- Download SMMA Crossover Signal Indicator for MT4.mq4
- Copy SMMA Crossover Signal Indicator for MT4.mq4 to your Metatrader Directory / experts / indicators /
- Start or restart your Metatrader 4 Client
- Select Chart and Timeframe where you want to test your MT4 indicators
- Search “Custom Indicators” in your Navigator mostly left in your Metatrader 4 Client
- Right click on SMMA Crossover Signal Indicator for MT4.mq4
- Attach to a chart
- Modify settings or press ok
- Indicator SMMA Crossover Signal Indicator for MT4.mq4 is available on your Chart
How to remove SMMA Crossover Signal Indicator for MT4.mq4 from your Metatrader Chart?
- Select the Chart where is the Indicator running in your Metatrader 4 Client
- Right click into the Chart
- “Indicators list”
- Select the Indicator and delete
SMMA Crossover Signal Indicator for MT4 (Free Download)
Click here below to download:
