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EMA (Exponential Moving Average)
Moving average that weights recent prices more heavily — reacts faster than a simple moving average.
What it is
An Exponential Moving Average gives more weight to recent price action and less to older data, making it more responsive than the Simple Moving Average (SMA). Popular settings: 21 EMA (short-term trend), 50 EMA (medium), 200 EMA (long). Price above the 200 EMA is the classic 'we're in a bull trend' filter — most professional crypto strategies only take longs when this is true. EMA crosses (e.g. 50 crossing above 200, the 'golden cross') are slower than MACD signals but carry far more weight when they fire.
Example
BTC drops below its 200-day EMA at $72,000 after a Fed announcement. Within a week, swing-trading bots that filter on '200 EMA = bull regime' stop opening new longs. The market enters a 30% drawdown over the next two months — exactly the scenario the 200 EMA filter exists to dodge.
How Indikora uses EMA
Indikora's 4h MTF gate refuses long entries when the 200 EMA on the higher timeframe is sloping down — preventing trend-fighting trades.
Related terms
- MACD (Moving Average Convergence Divergence) — Trend-momentum indicator: difference between 12 and 26-period EMAs, plotted with a 9-period signal line.
- Trend (Uptrend, Downtrend, Sideways) — The dominant direction of price over a given timeframe: up, down, or sideways (consolidation).
Strategy guides that cover this
- How to Trade with RSI — A Complete Strategy Guide
Three reliable RSI setups, when each works, and the mistakes that turn RSI from edge into noise - MACD Divergence Strategy — The Complete Playbook
How to spot, validate, and trade MACD divergence with high-conviction confluence checks