After 10 Years, I Found the Perfect EMA Settings! It Shows Exact Signals!

Strategy overview

A trend-following, price-action entry method using two 3-EMA ribbons (short vs. long) to identify trending markets, wait for pullbacks, and enter on a break of the prior swing. Emphasizes layered confirmation and strict risk management (1% rule, 2:1 reward:risk).

Layered confirmation: ribbon separation → pullback to 89 EMA ribbon → break of prior swing (candle close) → entry.

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Instruments & indicators

• Exponential moving averages (EMAs)
• “Moving average ribbon” indicator (used to overlay EMA ribbons; commonly available on platforms like TradingView)
• Price-action signals (swing highs/lows, candle closes)
• Risk-management rule referenced: 1% rule

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Applicable markets

• Generic price-action/trend strategy — no specific tickers, assets, sectors, bonds, crypto, or commodities were mentioned.

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EMA settings and visuals

• Two ribbons, each composed of three EMAs:
  • Short ribbon (white): 13 EMA on High, Close, Low
  • Long ribbon (orange): 89 EMA on High, Close, Low
• Styling recommendations:
  • Increase line thickness
  • Set colors to white (short ribbon) and orange (long ribbon) for visibility

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Step-by-step framework (how to use the ribbons)

1. Add the two 3-EMA ribbons:
   • Ribbon A (white): 13 EMA (High, Close, Low)
   • Ribbon B (orange): 89 EMA (High, Close, Low)
2. Interpret ribbon relationship:
   • Overlap between ribbons → market is ranging / non-trending
   • Ribbons separated → trending market
     • White ribbon below orange ribbon → downtrend
     • White ribbon above orange ribbon → uptrend
3. After confirmed separation, wait for a pullback to the orange (89) ribbon.
4. Identify the relevant prior swing point before the pullback:
   • Downtrend (short): mark the lowest low prior to the pullback
   • Uptrend (long): mark the highest high prior to the pullback
5. Entry confirmation:
   • Short: enter when a candle closes below the marked prior swing low
   • Long: enter when a candle closes above the marked prior swing high
6. Place stop and target:
   • Stop loss: beyond the white (13) ribbon (above for shorts, below for longs)
   • Take-profit: at 2× the risk (R:R = 2)
7. Manage the trade and monitor trend:
   • If the white ribbon moves into the orange ribbon → signals weakening
   • If the white fully crosses through the orange → possible trend reversal

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Risk management & position sizing

• Use the 1% risk-per-trade rule (risk 1% of account per trade).
• Position size should be set so that stop loss equals 1% risk; take-profit is set at 2× that risk.
• The presenter stresses proper risk management and that the strategy is not infallible.

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Behavioral / confirmation notes

• The method relies on layered confirmation: ribbon separation, pullback to the 89 EMA ribbon, then price-action confirmation via a candle close beyond the prior swing level.
• Partial intrusion (white moving into the orange) indicates weakening but not necessarily a trend change unless the white fully crosses.
• Final confirmation is price-action (a close beyond the marked level), not only ribbon position.

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Performance, limitations & cautions

• Presenter claims the method finds high-probability setups but acknowledges false signals will occur.
• No claims of a 100% win rate.
• Emphasis on managing risk (1% rule) and accepting occasional losses.

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Other resources & disclosures

• Presenter authored a book: “The Arts of Price Action Trading” (link referenced in video description).
• A separate risk-management guide and other links were referenced in the video description.
• No explicit “not financial advice” phrase shown, though the presenter warns of false signals and stresses risk management.

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Presenter & tools referenced

• Unnamed YouTube host / video creator (also the author of the referenced book).
• Indicator referenced: “moving average ribbon” (platform implied but not explicitly named).