EMA (Exponential Moving Average)
What it shows
The EMA 9/21 cross compares two fast exponential moving averages to capture the direction of the short-term price trend.
How to read it
The moment of the cross matters more than the gap between the averages. A fresh upward cross has historically started upward impulses, a downward one downward waves; confirm them with volume and RSI.
Parameters
- EMA 9 vs EMA 21 alignment
- EMA 9 above EMA 21 suggests a short-term uptrend; below EMA 21 suggests a downtrend.
- Positive reading: EMA 9 above EMA 21 (bullish alignment) is historically supportive of continued gains.
- Negative reading: EMA 9 below EMA 21 (bearish alignment) is historically pressure toward continued declines.
- Neutral reading: Averages intertwined or just after a cross: short trend direction uncertain.
Example
EMA 9 crosses above EMA 21 (a short-term golden setup) on rising volume, which is historically a supportive environment for continuation. A downward cross (bearish setup) historically signaled weakening; intertwining EMAs mean a sideways trend.