OPEN-SOURCE SCRIPT
3-EMA Ribbon Scalping System
3-EMA Ribbon Scalping System V2 - Trading Guide
Overview
This indicator combines a triple EMA ribbon with VWAP, RSI, and volume analysis to catch high-probability scalping setups for short pip hunting on highly liquid Forex pairs such as EUR/USD
The Core Strategy
The system waits for three conditions to align before firing a signal:
1. EMA Stack** - The 8/13/21 EMAs must be properly stacked (bullish: 8>13>21, bearish: 8<13<21)
2. VWAP Position** - Price needs to be on the right side of VWAP for the trade direction
3. Pullback Entry** - Price pulls back to test the fast EMA while maintaining the trend structure
When these line up with proper RSI readings and a volume spike, you get your entry signal.
Reading the Signals
LONG Entries
Triggered when:
- EMAs are bullishly stacked (green background)
- Price is above VWAP
- We get a pullback to the 8 EMA that holds
- RSI is between 40-70 (momentum present but not overbought)
- Volume exceeds the 20-period average by 1.2x
SHORT Entries
Mirror opposite conditions:
- Bearish EMA stack (red background)
- Price below VWAP
- Rejection at the 8 EMA
- RSI between 30-60
- Volume confirmation present
Risk Management Built In (freely adjustable to match your own approach when it comes to taking risk)
Each signal automatically calculates:
- Stop Loss: 1x ATR from entry
- Target 1: 1:1 risk/reward ratio
- *arget 2: 2:1 risk/reward ratio
You can display these as lines or labels, or turn them off entirely if you prefer your own levels.
Quick Setup Tips
Start with the default settings - they work well on most timeframes from 1-minute to 1-hour charts. The sweet spot for scalping is typically the 3-minute or 5-minute timeframe.
The info panel in the top right gives you a quick market snapshot without cluttering your chart:
- Trend direction
- VWAP position
- RSI value
- Volume status
- Current signal state
If you're getting too many signals, increase the "Min Bars Between Signals" to filter out choppy action. For cleaner charts during analysis, you can toggle off individual components like the ribbon, backgrounds, or signals.
Tips for Live Trading
1. Don't chase - Wait for price to come to the 8 EMA, not the other way around
2. Volume matters - That volume spike filter catches the moves with real momentum behind them
3. Respect the trend - The EMA stack keeps you trading with the flow, not against it
4. Use multiple timeframes - Check a higher timeframe for overall bias before taking signals
The indicator includes alerts that fire with exact entry, stop, and target levels - perfect for quick execution or logging trades.
Remember, this is a scalping system designed for active trading. It works best in trending markets with good volatility. During ranging or low-volume periods, consider sitting on your hands or reducing position size. Trade at your own risk, I created this solely for educational purposes!
Customization Options
Display Settings
- Show/hide EMA ribbon
- Toggle entry signals
- Background colors with adjustable opacity
- Info panel size options
- VWAP visibility
Technical Parameters
- EMA Settings: Adjustable lengths for fast (8), medium (13), and slow (21) EMAs
- RSI Settings: Customizable overbought/oversold levels and momentum thresholds
- Volume Settings: Multiplier for volume confirmation and MA length
- Risk Management: ATR multiplier for stops, customizable R:R ratios
Nearly everything is adjustable, but the defaults are solid. Focus on reading the market structure first before tweaking settings.
Visual Features
Background Colors
- Green: Bullish trend (EMAs stacked bullishly)
- Red: Bearish trend (EMAs stacked bearishly)
- Gray: Neutral/choppy conditions
Signal Styles
Choose between:
- Text labels
- Arrow markers
- Both combined
Stop Loss & Take Profit Display
Three modes available:
- None: No SL/TP visualization
- Current: Shows lines for active trade
- Labels: Displays small labels at price levels
Best Markets & Timeframes
Optimal Markets:
- Forex pairs (especially majors)
- Stock indices
- Liquid cryptocurrencies
- High-volume stocks
Alert System
Comprehensive alerts include:
- Entry signal notification
- Exact entry price
- Stop loss level with pip distance
- Take profit levels with pip distances
- Trade direction and symbol
Important Notes
- This is a "momentum-based scalping system" - not suitable for ranging markets
- Best results come from pairing with your understanding of key levels and market context
- The volume filter helps avoid false signals during low-liquidity periods
- Consider overall market conditions and news events before trading
Version Info
3-EMA Ribbon Scalping System
- Refined entry logic
- Improved visual clarity
- Enhanced risk management tools
- Optimized performance tracking
Overview
This indicator combines a triple EMA ribbon with VWAP, RSI, and volume analysis to catch high-probability scalping setups for short pip hunting on highly liquid Forex pairs such as EUR/USD
The Core Strategy
The system waits for three conditions to align before firing a signal:
1. EMA Stack** - The 8/13/21 EMAs must be properly stacked (bullish: 8>13>21, bearish: 8<13<21)
2. VWAP Position** - Price needs to be on the right side of VWAP for the trade direction
3. Pullback Entry** - Price pulls back to test the fast EMA while maintaining the trend structure
When these line up with proper RSI readings and a volume spike, you get your entry signal.
Reading the Signals
LONG Entries
Triggered when:
- EMAs are bullishly stacked (green background)
- Price is above VWAP
- We get a pullback to the 8 EMA that holds
- RSI is between 40-70 (momentum present but not overbought)
- Volume exceeds the 20-period average by 1.2x
SHORT Entries
Mirror opposite conditions:
- Bearish EMA stack (red background)
- Price below VWAP
- Rejection at the 8 EMA
- RSI between 30-60
- Volume confirmation present
Risk Management Built In (freely adjustable to match your own approach when it comes to taking risk)
Each signal automatically calculates:
- Stop Loss: 1x ATR from entry
- Target 1: 1:1 risk/reward ratio
- *arget 2: 2:1 risk/reward ratio
You can display these as lines or labels, or turn them off entirely if you prefer your own levels.
Quick Setup Tips
Start with the default settings - they work well on most timeframes from 1-minute to 1-hour charts. The sweet spot for scalping is typically the 3-minute or 5-minute timeframe.
The info panel in the top right gives you a quick market snapshot without cluttering your chart:
- Trend direction
- VWAP position
- RSI value
- Volume status
- Current signal state
If you're getting too many signals, increase the "Min Bars Between Signals" to filter out choppy action. For cleaner charts during analysis, you can toggle off individual components like the ribbon, backgrounds, or signals.
Tips for Live Trading
1. Don't chase - Wait for price to come to the 8 EMA, not the other way around
2. Volume matters - That volume spike filter catches the moves with real momentum behind them
3. Respect the trend - The EMA stack keeps you trading with the flow, not against it
4. Use multiple timeframes - Check a higher timeframe for overall bias before taking signals
The indicator includes alerts that fire with exact entry, stop, and target levels - perfect for quick execution or logging trades.
Remember, this is a scalping system designed for active trading. It works best in trending markets with good volatility. During ranging or low-volume periods, consider sitting on your hands or reducing position size. Trade at your own risk, I created this solely for educational purposes!
Customization Options
Display Settings
- Show/hide EMA ribbon
- Toggle entry signals
- Background colors with adjustable opacity
- Info panel size options
- VWAP visibility
Technical Parameters
- EMA Settings: Adjustable lengths for fast (8), medium (13), and slow (21) EMAs
- RSI Settings: Customizable overbought/oversold levels and momentum thresholds
- Volume Settings: Multiplier for volume confirmation and MA length
- Risk Management: ATR multiplier for stops, customizable R:R ratios
Nearly everything is adjustable, but the defaults are solid. Focus on reading the market structure first before tweaking settings.
Visual Features
Background Colors
- Green: Bullish trend (EMAs stacked bullishly)
- Red: Bearish trend (EMAs stacked bearishly)
- Gray: Neutral/choppy conditions
Signal Styles
Choose between:
- Text labels
- Arrow markers
- Both combined
Stop Loss & Take Profit Display
Three modes available:
- None: No SL/TP visualization
- Current: Shows lines for active trade
- Labels: Displays small labels at price levels
Best Markets & Timeframes
Optimal Markets:
- Forex pairs (especially majors)
- Stock indices
- Liquid cryptocurrencies
- High-volume stocks
Alert System
Comprehensive alerts include:
- Entry signal notification
- Exact entry price
- Stop loss level with pip distance
- Take profit levels with pip distances
- Trade direction and symbol
Important Notes
- This is a "momentum-based scalping system" - not suitable for ranging markets
- Best results come from pairing with your understanding of key levels and market context
- The volume filter helps avoid false signals during low-liquidity periods
- Consider overall market conditions and news events before trading
Version Info
3-EMA Ribbon Scalping System
- Refined entry logic
- Improved visual clarity
- Enhanced risk management tools
- Optimized performance tracking
Open-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Open-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.