IQ Option Trading using the Average Directional Index (ADX) and Exponential Moving Average (EMA) Strategy

Conditions for using the trading strategy “ADX + EMA”

The trader must connect the following instruments to the price chart to start trading according to the strategy:

1. EMA trend indicator with a period of 20.
2. ADX oscillator with a period of 14 and levels of 20; 50.

Any asset on timeframes from 5 minutes to 4 hours is suitable for trading with this strategy. But the optimal time interval is 30 minutes and 1 hour.

Buying / selling by strategy “ADX + EMA”

To correctly determine the trading signal to buy, the Trader needs to wait until the line +D1 (ADX indicator) intersections the improvised level 20 from the bottom up and continues to move above it. The trend strength line should move in the upper area of the indicator scale. EMA should take place under the candles of the price chart at this time. This is a buy signal. Trader can open a long position.

To interpret the signal to sell assets, the trader must wait until the line -D1 (ADX indicator) intersections level 20 upwards and continues moving above it. At this time, the trend strength line should move in the upper area of the indicator scale, and the EMA indicator should move above the candles on the price chart. This is a sell signal. Trader can open a short position.

Attention. The bet of one transaction over 3% of deposit is an unjustified risk.

Basic rules for increasing the efficiency of trading using the strategy “ADX + EMA”

Trader can conclude transactions not only at the moment of forming a trend, but also during all price corrections.

Users should ignore trading signals if the –Dl or + Dl lines of the ADX indicator pass near level 50, even if all other conditions are met.

The strategy “ADX + EMA” is intended for trend trading. During flat, it is better to use another strategy, choose another asset, or refrain from trading.

Summary

The article describes all the conditions and rules of the trading strategy “ADX + EMA”. These recommendations will allow even a beginner to quickly and confidently start trading. However, one should not dwell on the achieved knowledge and forget about the risks. Since in trade, you need to constantly learn new instruments, develop and master new strategies. Trade wisely on IQ Option.