This system trades for all currency pairs. In essence, the rainbow curves are the moving averages. More specifically as follows:
  • Yellow EMA: 2,3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15;
  • Blue EMA: 17, 19, 21, 23, 25, 27, 29, 31, 33, 35, 37, 39, 41;
  • Green EMAs: 44, 47, 50, 53, 56, 59, 62, 65, 68, 71, 74;
  • Red EMAs: 78, 82, 86, 90, 94, 98, 102, 106, 110, 114, 118, 122;
  • Pink EMA: 125, 130, 135, 140, 145, 150, 155, 160, 165, 170, 175, 180, 185, 190, 195, 200.
Why are there so many moving averages? Simply because they allow us to see a complete market overview in the short, medium and long term trends.

The golden EMA is for those who like to surf a few pips. The blue EMA is good for intraday traders. Green EMA represents the mid-term trend. The red EMA is an indicator for long-term traders. The pink EMA is only intended for traders holding orders for a few years or more.

Trends are friends, and moving averages are one of the indicators of trend. If the EMAs are arranged in order: yellow, blue, green, red, and pink, just close your eyes and buy. If they are in reverse order, this is a sell signal.

Illustration of buy order:

Illustrate the sell order:

When the EMAs cross over or roll into each other, that's when the market is sideways. Traders should stay out of the way at these times, even though the chart looks cool. Remember, not entering is an order.

This method is also used to beat breakouts quite effectively. In the example below, the price goes down and then shoots up and cuts all moving averages. To confirm the market reversal, the red EMA and the pink EMA have to cross.

Below is an example of a false breakout. Even though the price has crossed all moving averages, the red EMA has not crossed the green one, and the EMAs are out of order.

This is a good example of a trend buying. As you can see the EMAs are all pointing up, we enter a buy order when they start to be arranged in ascending order. Stop loss is located below the pink EMA, which is a pretty solid stop loss.

In short, the rainbow curves are quite simple, easy to use and highly efficient. If anyone wants to learn, let's start with the H1 frame.

Since adding the EMAs is a bit laborious, I have attached the rainbow template below.

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