When say like 12 ema is 10 pips away from the 26 ema on a 30min chart. What does that tell me, like when it crosses over does that mean the entry signal is stronger than if it were a 3 pip distance? Thanks!
When the distance between two moving averages get larger, it means that momentum is increasing.
It’s funny you mention the 12 and 26 ema because I think that is what is used in calculating the default MACD which is a popular momentum indicator.
With regards to crossovers, these can be used as entry signals. Bullish crossover would be when the 12 closes above the 26. Bearish is when the 12 closes below the 26. Obviously, these signals will be late because moving averages lag but they are a useful guide.
Thank you InsearchofPips! Info means a lot and gave me a better understanding, thank you!
Indeed it is and maybe that’s where the question originated from :). Fully agree with your response!