Trigger Line is an MT4 trend indicator especially developed for scalpers and day traders in forex and stock markets.
It plots crossovers between the Least Squared Moving Average (LSMA) and trigger line MA to determine the changes in the market bias.
Apart from showing bullish/bearish trend signals, the Trigger Line also highlights the dynamic support-resistance zone on the main price chart.
Besides, it follows the basic rules of moving averages helping beginner-level traders determine correct market trends while making trading decisions.
This guide explains how to use the Trigger Line Indicator in MT4 to spot potential changes in price trends.
What is the Trigger Line Indicator?
The Trigger Line indicator is extremely sensitive to changes in price actions and generates real-time trend signals. It enables you to make precise trading decisions while opening and closing an order.
It plots trend signals based on the crossovers between the Rperiod MA (trigger line) and the LSMA. A bullish crossover happens when the LSMA exceeds the trigger line. Oppositely, the LSMA moves below the trigger line to signal a bearish crossover.
After you get the confirmation of a market trend, you can anticipate trading opportunities on potential price breakouts and pullbacks. For example, during a bullish trend, you can enter long at the break of the LSMA level. Alternatively, you may wait for price retracement near the moving average, aiming for a pullback entry.
Besides trend-following entries, you can also use the indicator to explore swing trading options by combining it with an overbought/oversold indicator.
For example, the Trigger Lines plot a bearish crossover, and the price moves below the MA after making a solid bullish run. If an RSI or Stochastic indicator signals an overbought market, we may expect a bearish trend reversal in such conditions.
Furthermore, the Trigger Line helps you make solid trade exit decisions and determine the stop-loss zone for active trades. You can exit a trade if the price breaks the trendline support (LSMA) within an opposite direction to your entry. Alternatively, you may close the trades based on opposing crossover signals.
Trigger Line Trading Strategy
Buy Signal
- The price holds above all the moving averages of the indicator.
- The LSMA moves above the Trigger Line to plot a bullish crossover.
- Hold long positions until the indicator develops a bearish crossover signal.
Sell Signal
- The price holds below all the moving averages of the indicator.
- The LSMA moves below the Trigger Line to plot a bearish crossover.
- Hold short positions until the indicator generates a bullish crossover signal.
Trigger Line Indicator Pros/Cons
Pros
- Uses simple moving average crossover techniques to spot critical changes in market trends.
- Determines dynamic support/resistance levels.
- Assists with trade-exit decisions.
Cons
- May not work in flat trend conditions and low-volatile markets.
Conclusion
The Trigger Line Indicator is one of the simplest MT4 trend indicators you may have ever tried. Since it follows a basic moving average crossover strategy, traders with any level of previous market knowledge will be able to read its trend signals. Apply the indicator on larger timeframes (H4 and higher) alongside a consistent price action trading strategy for better trading confirmations.
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