EMA + ADX Trend Strength Strategy

How the strategy works

This template gives you a starting point. Backtest it with historical data, review the trade log and adjust one setting at a time.

Example entry rules

1. Use EMA 20 above EMA 50 for long direction and EMA 20 below EMA 50 for short direction.
2. Require ADX(14) to be at least 25 before entering.
3. Require both EMA direction and ADX confirmation on a completed candle.

Example exit and risk rules

1. Apply the selected stop-loss and take-profit protection.
2. Exit on the opposite EMA crossover when applicable.
3. Auto-close when overnight holding is disabled.

Always test with realistic slippage, spread, position size and daily loss limits.

Potential advantages

• Uses EMA for direction and a second indicator for confirmation
• Filters some weak EMA signals
• Ready for historical testing before paper trading

Important limitations

• ADX measures trend strength and does not reliably provide direction by itself
• Strong ADX readings can appear after a move has already started
• Backtests do not guarantee future performance