Profitable Gold Indicator Strategy Explained. XAUUSD Trend Following Trading Made Simple

To profitably trade a massive bullish rally on Gold, you don't need a complicated system.

In this article, I will teach you an easy indicator strategy for trend-following trading XAUUSD.

It is based on 2 default technical indicators that are available on any trading platform: Mt4, Mt5, TradingView, etc.

You will get a complete trading plan:

• exact entry signal,

• smart stop loss placement,

• safe trade management rules.

Indicator 1

The first indicator that you will need to trade this strategy is Moving Average MA.

We will use a combination of 2 Moving Averages:

• Exponential Moving Average EMA with 20 length,

• Simple Moving Average SMA with 9 length.

Entry Signal

Our entry signal will be a crossover of 2 MA's on a 4H time frame.

SMA and EMA should meet first.

SMA should break through EMA to the upside to confirm a bullish signal.

With a high probability, Gold price will rise significantly then.

Avoid Traps

The main nuance of this strategy is to wait for a confirmed crossover and avoid the traps.

Patiently wait for a touch of 2 moving averages first.

After that, you will need to wait for a close of one more 4H candle to make sure that SMA stays above EMA.

You can see that though 2 Moving Averages met, SMA failed to break through EMA.

Valid Confirmation

That is how a valid buy signal looks: SMA stays above EMA after a close of the next 4H candle.

Placing a Trade

After you identified a valid crossover, it is your signal to open BUY trade on Gold.

• Your entry should be exactly after a close of a 4H candle.

• Stop loss will be based on another popular free indicator - Average True Range ATR with default 14 length settings.

Your safe stop loss should be 2 ATR from the entry.

In our example, ATR is 145 pips.

2 ATR will be 290 pips.

That will be our stop loss.

Trailing Stop Loss

With this trading strategy, we will not use a fixed Take Profit TP and use trailing stop loss instead.

It will help us to catch extended bullish waves on Gold.

Once the market starts rising, updating the highs, trail your stop loss based on EMA and keep it 1 ATR below that.

Important Rule

Make sure that you move your stop loss only when EMA and Gold price are rising. Once Gold price or EMA start moving in sideways or go down, do not lower your stop loss.

Strategy Potential

Using this strategy consistently, you will be able to catch significant bullish waves.

In Autumn trading season of 2025, this strategy provided, 3100+ pips entry signal.

What I like about this strategy is that being very simple, you can easily backtest that and measure its objective trading performance.

Easy entry, confirmation, and trade management rules make this strategy appropriate for beginners in Gold XAUUSD trading and will help to not miss a current extraordinary trend.