Ok, I don’t have a picture, but you can get the idea from a description. This is what you do:
Go to your chart (any time frame, but for scalping I use 1M & 5M) set an SMA14 (or other favorite period).
Set another MA, but EMA this time. Change the line type or color as visual aid.
When the bars have traveled over (or under) both right about the time the MA’s crossed AND the bars are not hitting the MA’s AND there is a noticeable gap between the MA’s, you draw a trendline.
Draw this trendline starting about where the MA’s cross, and roughly bisect the gap. Follow the chart and gauge the gap.
When the price breaks the trendline, place your trade. Follow it to whatever feels comfortable. This more of a price-action following and revert-to-normal type of trading. Really, I’m just following the price as it swings back to get in balance.
Here’s some pictures (I changed my mind), you’ll see:
It works better when the price is swinging away from both MA’s, and has to whip back on the curvature it drew on the chart. This could also be a momentum-type of trade. I don’t really care, because a) it works, and b) it follows the price rhythm. The diagonal trendline is dynamic from time to time, so there are no worrys about psychological price levels, etc.
This was on a 5-minute chart, at about 4 in the morning, London, so it was slow. That break was worth about 3.5 pips. Not much, but for this time of night, for finding that setup, it’s just fine. By the way, the next bar continued up, and made a total of at least 8, although I would have been happy with 4. Hey, free money!
Oh, and a great piece of advice that took me a long time to accept: Wait For The Setup!