3-EMA M5 Scalping — Simple Short-Term Trend Scalper

TL;DR: 3-EMA M5 scalping uses EMA(21,13,8) on H1 to define trend bias, then scalps on M5 by placing pending stop orders just beyond the high/low of the last five M5 candles in the trend direction. Pending orders expire after ~60 minutes if not filled. Initial TP = 1:1 (SL distance); manage winners with trails or scale-outs. This method is mechanical and automation-friendly but sensitive to spreads and execution.

1. Introduction

3-EMA M5 scalping is a focused, mechanical approach pairing higher-timeframe trend confirmation with short-term M5 entries. The system uses three EMAs to define bias on H1 and a clear rule to place pending stops around recent M5 extremes. It suits discretionary scalpers and EA implementation when spreads and execution are reliable.

2. Strategy overview — 3-EMA M5 scalping summary

• Instrument: major FX pairs (tight-spread crosses) or liquid indices.
• Bias TF: H1 with EMAs 21/13/8 (EMA order defines the 3-EMA M5 scalping bias).
• Execution TF: M5 (use last-5-candle extremes).
• Core idea: Align H1 EMA order, then place pending stops just beyond recent M5 extremes to catch short impulsive moves.

3. Setup

• Add EMAs: EMA(21), EMA(13), EMA(8) on H1 and M5. Use H1 for bias check and M5 for entries.
• Layout: H1 tab (trend), M5 tab (execution).
• No extra indicators required — optionally monitor spread and tick/volume for confirmation.
• Confirm brokerage constraints (min stop distance) and set pending order expiry handling.

4. Trading rules

4.1 Filter / Bias (3-EMA M5 scalping filter)

• Long bias only if H1 EMAs stacked bullish: EMA8 > EMA13 > EMA21.
• Short bias only if H1 EMAs stacked bearish: EMA8 < EMA13 < EMA21.
• If EMAs mixed, do not trade.

4.2 Signal

• Signal reference = high or low of last 5 M5 candles (use the most recent five completed candles).

4.3 Entry

• Place pending stop orders in trend direction:
  • Long: Buy Stop at High(last 5 M5) + buffer.
  • Short: Sell Stop at Low(last 5 M5) − buffer.
• Default buffer: 3 pips (adjust per instrument volatility or use ATR-based buffer).
• Expire pending order after ~60 minutes (or N bars).

4.4 Stop-loss

• Place SL at the opposite extreme or just beyond the trigger reference (i.e., the low of the last 5 for longs, or the high for shorts). Ensure SL fits your risk rules.

4.5 Take-profit & Trade Management

• Initial TP = 1:1 (distance equal to SL).
• Management: scale out 50% at 1:1 and trail remaining; or use ATR-based trailing after first target.
• Monitor spreads — scalp margins are tight.

4.6 Invalidation

• Cancel pending entries / close trades if: H1 EMA order flips, a high-impact news event occurs, or spreads/execution worsen. Do not average into a losing scalp.

5. Position sizing & Risk Management

• Risk per trade: 0.5%–1% of equity (adjust per volatility).
• Compute lot size from SL so monetary risk = chosen % equity.
• Limit concurrent scalps and cap per-session attempts (e.g., max 3 attempts per hour).
• Stop trading for the day after predetermined drawdown or consecutive losses.

6. Backtest & Validation

• Backtest on M5 data with realistic spreads and fills across pairs & sessions.
• Validate expectancy, win rate, profit factor and max drawdown.
• Walk-forward test before live scaling.

7. When NOT to trade

• During high-impact news or abnormal spreads.
• When H1 EMAs are mixed (no clear trend).
• If SL would be too large relative to account risk.

8. Variations & Optimizations

• Use ATR-based buffer (e.g., 0.3× ATR(14) on M5) instead of fixed 3 pips.
• Adjust trigger window (last 3 vs 5 candles) to tune sensitivity.
• Cancel after N bars instead of fixed minutes.
• Add tick/volume filter to reduce false triggers.

9. Pre-trade checklist

• H1 EMA(21/13/8) alignment confirmed.
• Last-5 M5 candle high/low identified.
• Pending order parameters (buffer, expiry, SL, TP) set.
• Spread acceptable and no imminent news.
• Session limits and daily loss cap defined.

10. Conclusion

The 3-EMA M5 scalping approach is a concise, mechanically definable strategy pairing higher-TF trend confirmation with short M5 break triggers. It is straightforward to automate but requires strict spread/execution checks and instrument-specific validation before live deployment.

11. FAQ

Q: Is the 3-pip buffer fixed across instruments?
A: No — adjust buffer per instrument volatility (ATR advised).
Q: Can this be run as an EA?
A: Yes — rules are mechanical and EA-friendly; include fill/error handling and rate limits.