Moving averages are a familiar technical indicator to many traders, a lot of strategies are built around it. Moving averages have many useful roles in trading, in which there is 3 most important information that moving average provides traders, they are:
  • Tendency
  • Trend change
  • Dynamic resistance support
There are many types of moving averages with different periods, of which the SMA and the EMA are the two most commonly used moving averages.

Most moving average trading strategies have been developed around these roles. There are traders who use only one moving average, while many other traders use 2, 3, or even many different moving averages to form a moving average of their strategy.

In this article, an indicator coded on This indicator is based on 3 moving average EMA with cycles of 9, 21, and 55 respectively. And this indicator is named Z3MA.

What is Z3MA as an indicator?

Although moving averages are not a very high technical indicator, if we know how to use them, it can bring significant profits for us. Many brothers and traders especially like to use a combination of many moving averages in trading, however, the more complex the strategy, the more ineffective it is.

Combining 3 MA lines and at the same time reporting trading signals so that you can save money from monitoring the market.

The image below is the indicator interface with the notification signal green arrows (buy signal) and red (sell signal):

Set indicator parameters

The file download indicator attached below the article, you download and install it on MT4 to try it out.

The input you install as instructions in the picture below:

The color you can customize according to your own taste. And after installation, the chart will look like the image below:

Applying trading

The 3 EMAs will have the following roles:
  • EMA 55: Considered as a long-term trend indicator. When the 55 EMA is below the 9 and 21 EMA, we consider it an uptrend and vice versa, the 55 EMA is above the 9 and 21 EMA it is a downtrend.
  • EMA 21: To identify a mid-term trend. 21 EMA is below the 9 EMA and above the 55 EMA, indicating an uptrend. If 21 EMA is above 9 and below 55 EMA it's a downtrend.
  • EMA 9: Used as a trading signal when there is a crossover with the remaining moving average. If the 9 EMA crosses the 21 EMA from below and meanwhile the 2 EMA is above the 55 EMA then we should identify a bullish trend and buy on a close candle at the time of the cross. Similarly, if the 9 EMA crosses the 21 EMA and both EMAs are below 55 EMA, then we would trade on a close candle at the crossroads.