Hey I’m a trend trader an use the 20, 50 ema and the 200 Sma. When I’m looking for a trend I look for price to be below the 200sma, price to be below the 50 ema and the 20 ema and also the 20 and 50 has to be sloping either up or down. When I then scale down to the entry time frame do I still need to use the 200 sma on this time frame or can I take it off my chart
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Well I cannot argue against your approach! I have been using the very same basic formula for my trade decisions for some decades now and still have not changed from it. From time to time I have experimented with adding on various bells and whistles, but quickly discarded them and reverted to this core set-up
I use it on all TFs from daily to 5 mins.But the SMA 200 I only apply to the Weekly, Daily and 4H charts. Apart from a trend direction indicator it also functions as a S/R level, especially on the Daily and Weekly charts - not for any mystical reason, simply because very many traders, both retail and commercial also watch these levels and they are therefore fairly self-fulfilling at least to a certain degree.
But I do NOT use this set up as an MA crossover system.
I DO use it for entries
My exits are usually based on a pre-set pip amount (depending on the instrument and the TF) and on a “set and forget” basis-, but I trade on a discretionary basis and monitor my trades and my closures are not always so mechanical!
It is deeply refreshing to meet someone here who does not immediately trash indicators like MA’s because they are “lagging” in favour of PA (which is also lagging but people don’t seem to realise that!).
MA’s are useful simply because they are lagging! That is what they are designed for and they provide an excellent sense of relativity, comparing current price movement with previous.
I am sure you are doing well!
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If you’re using a pure mechanical system then no you should keep the 200ma and you’ll save yourself a few bad entries. If its discretionary then you can do without to keep the charts simple.
Why do you say that PA is lagging?
Because both indicators and PA use both historic and current price to derive an estimation of likely future direction.
Historical price is a component of both approaches.
Often the value of an indicator is precisely because it is based on historic prices, for example, in identifying underlying direction, excessive movement, etc, etc.
I am not a fan of indicators other than a couple of MAs but i can understand why others do find value in them. To be honest, i simply find most indicators to be superfluous rather than wrong.
But that is something each trader decides for themselves. My main suspicion is that many newcomers do not bother to find out how an indicator is constructed and how it works and what it is designed to do. Particularly with more complex structures like stochastics, MACD, and ichimoku.
When one analyzes something that changes over time one needs to consider “history” or previous state. That does not make PA lag. Lag is relative to current price therefore PA can never lag. If PA lags then price lags and that is impossible.
In the same way, indicators include both historic price and current price. Once you become familiar with using indicators properly then you realise that they are feeding you information on the current state of the market price relative to historic action. That is what it is defined to do.
That process is identical in PA, just the method is different. Looking at highs, lows, lines, patterns, and anything else that various traders at various times include as price action, and comparing with where current price now is, is no different to comparing current price with, say, an MA which defines where it has previously been and whether it is coming from below or above, etc.
Indicators do not exclude current price at all. To think that would be very naive.
For example, in my own analysis, i first consider the chart without anything on it and then toggle the indicator skin back over it to add structure. It’s a simple toggle switch on/off. But that is just what works for me.
Therefore, yes, PA is the same thing. If you wish to define
I’m not sure how to interpret your response. Do you still maintain that PA is lagging?
I don’t see much point in having the same conversation on two threads simultaneously but to clarify.
I disagree with the blanket use of the word “lagging” in either case. As you have confirmed, any form of analysis requires consideration of historic price and current price.
Indicators and PA components both fulfill this although “current price”, in both approaches, may in fact be a local high or low or dynamic move through a defined level, etc and not necessarily the very latest price print.
Whatever you are comparing current price with is already history. For example, the position of current price relative to an MA is telling where we are right now compared to where we have, on average, been in the recent past up to now. If one compares current price with a previous high/low then that is just another way of performing the same process of comparative analysis.
In some cases, comparing 2 MAs is based entirely on historical data - but that is precisely the purpose and it provides information that can be relevant now. So applying the term "lagging"in a derogatory manner to such a method is to deny the value that others see in that.
So my only point is that traders need to know and understand what they are using and what is its purpose, benefits and limitations rather than just label things with some kind of generic assumption.
I don’t think you understand the term “lagging” as it applies to trading. Price can never lag, period! There are no qualifications to this statement.
Well that seems more than clear from you too, in fact even your understanding of PA is very suspect. But never mind, that is for you to develop as your trading matures over time.
But it is a enjoyable journey and you will find some enlightening moments along the way! 
But it seems you have no more concrete issues to raise here, and Christmas starts here tomorriow, so i am rather more engaged in family things now.
So i will wish you Happy Holidays. 
LOL! What do you know about PA? You don’t even know what lagging means, so please don’t try to patronize me.
A very merry Xmas to you too. 
Your descent into personal attacks on your fellow poster says far more about you than me.
You need to learn that not everyone is going to agree with you. Grow up.
I am not interested in your baiting. It does not belong on forums not is it ever done by serious traders.
We are done here, too
Just go and enjoy your Christmas for goodness sake!
I thought we we’re done here …
Price does indeed lag. It shows you the result of orders that have already been filled. Many people don’t understand this.
When you see a big long candle, does that mean buying was homogenous through the whole candle? Maybe yes, but maybe not.
Maybe most buying occurred at the low of the candle, but price kept climbing as there were still some buying orders entering the market combined with low liquidity (aka. less sellers), so price climbed despite lower buying power than at the very low of the candle.
This means price lags. You could see a big long candle, but most buying could have already happened at its low. There’s no guarantee that price will continue to climb, indeed, maybe price will reverse again as there may be no buyers left and sellers may enter the market now.
What you see on the chart is the result of orders that have already been filled. And still, you don’t know how many they were and how much liquidity was available and at what prices. Today a 100 pip move could happen with a lot lower buying power than yesterday’s 100 pip move, just because today there’s no liquidity and yesterday there was.
Price indeed lags, but it’s maybe the best tool we have. We could only say we have non-lagging information if we knew in real-time what orders were entering the market and how much liquidity is available. But that may be impossible.
Cheers
You’re talking about volume and liquidity. That has nothing to do with price lagging!!!
Price lags against what? Price is price. Price cannot lag! Get that straight please.
Price is the “only” tool that we have. Every indicator is derived from price.
Technically I suppose price does lag, but it only lags on the chart. And only then if the trader is using the wrong chart.
For instance if a trader makes decisions off the daily chart but this is not live, so it only shows completed daily bars / candlesticks / closing prices. So the real price obviously does not lag but the chart price is always up to 23 hours 59 minutes lagging. Of course, if the strategy he’s using depends on a real price, this is not the right way to make it profitable…
I have no idea what you are saying here.
Seriously? Please read your post aloud to yourself and see if it makes sense to you. It makes no sense to me at all.
If you guys (who claim to be experienced traders) want to make fools of yourselves by stating that price lags, that’s your problem. My problem is that newbies will believe your nonsense and regurgitate it to other newbies. Many trading falsities have been born this way.
I shall not comment on this drivel any further.
No, again, I don’t believe price lags: I actually typed “the real price obviously does not lag”.
Chart price can lag but only if the trader uses the wrong chart - e.g. a non-live D1 - but his strategy requires a live price and he does not (yet) realise his screw-up. So price does not lag but his chart price does. Newbies actually do this and don’t realise what’s going wrong. That’s not my fault and just because I’ve seen it happen does not mean I don’t know its wrong.
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MA is most commonly used indicator, and I find that it is quite good. But, indeed these indicators are lagging because they are using historical data. Try to fix this with combination of Bollinger Band