EMA Trend Following

EMA Trend Following uses the 20 and 50 Exponential Moving Averages to identify and trade established trends. You enter on pullbacks to the 20 EMA in the direction of the overall trend (confirmed by the 50 EMA slope).

This is a beginner-friendly strategy for prop firms because the rules are simple, the setups are clear, and you're always trading with the dominant market direction.

Uptrend entry: 1. 20 EMA is above 50 EMA and both are sloping up 2. Price pulls back to touch or come within 5 pips of the 20 EMA 3. A bullish rejection candle forms (pin bar, engulfing, or hammer) 4. Enter on the next candle open 5. Stop loss: below the pullback low + ATR buffer 6. Take profit: 2:1 R:R or the previous swing high

Downtrend entry: mirror of the above.

Filter: Only trade when ADX is above 25 (confirming trend strength).

Trend following produces winning streaks during trending markets and small losses during ranges. The key for prop firms: losses are small and capped (fixed stop at recent structure), while wins can be large (trailing with the trend).

Expected metrics: - Win rate: 45–55% - Average R:R: 2:1 to 3:1 - 1–2 trades per day - Weekly expectation: 2–4% on a $100K account at 1% risk

The slow pace and high R:R make this ideal for traders who struggle with overtrading.