The chart below uses 1,000 real EUR/USD hourly candles from 8 August through 18 September 2026. Indicators are calculated locally from the OHLC series. No candle, signal or result is drawn by generative AI.
Three tools with three different jobs
The indicators should not vote on the same question. Direction, strength and volatility are separated so that every rule has a clear purpose.
EMA 200 · Direction
Only long setups above EMA 200 and short setups below it are considered.
ADX 14 and DI · Strength
A setup begins when ADX crosses above 25 and the matching directional line is dominant.
ATR 14 · Distance
ATR sets a volatility-adjusted stop rather than using the same number of pips in every market condition.
Exact entry and exit rules
Long
After a candle closes above EMA 200, ADX 14 must cross upward through 25 and +DI must be above −DI. The long entry is placed at the next candle’s open.
Short
After a candle closes below EMA 200, ADX 14 must cross upward through 25 and −DI must be above +DI. The short entry is placed at the next candle’s open.
Stop loss · Take profit · Time exit
The initial stop-loss distance is 1.5 × ATR 14. The target is 1.5R, equal to 2.25 × ATR. The illustration allows only one open position and closes any unresolved trade after 72 hourly bars.
Real EUR/USD H1 candles, EMA and executed rules
Green and red arrows mark entries generated by the stated conditions. Yellow TP markers and red SL markers show how the mechanical exit was resolved. The lower chart contains ADX, +DI and −DI; the dashed level is 25.
EUR/USD · H1 · EMA 200
2026-08-08 — 2026-09-18 · UTC
What the limited sample shows
The window contains both target hits and stopped trades. That is important: the chart demonstrates rule execution, not a polished selection of winners. Spread, commission, swap and slippage are not included, so the displayed R result must not be treated as a deployable performance claim.
Where this framework breaks down
Late entries
ADX may cross 25 after a large part of the move has already occurred.
Range reversals
Price can move briefly beyond EMA 200 and return to the range.
News shocks
ATR based on earlier bars may understate the gap or slippage around major releases.
Broker differences
Session time, spread, candle construction and execution can change signals and outcomes.
How to test it properly
- Use at least several years of consistent EUR/USD H1 data.
- Include realistic spread, commission, swap and slippage.
- Keep EMA 200, ADX 14/25 and ATR 14 fixed for the first benchmark.
- Separate in-sample development from an untouched out-of-sample period.
- Run forward testing on demo before considering small live exposure.
A strategy is a rule set, not three indicators
EMA, ADX and ATR become useful only when entry timing, position sizing, costs and failure conditions are fixed. The value of this model is that it can be reproduced, challenged and improved without hiding losing examples.
Data source
This is a transparent historical illustration, not a promise or a complete backtest.