What are the best moving average settings for swing trading crypto?

Moving averages like the 9 EMA and 21 EMA on 4H charts help crypto swing traders spot trends and time entries, especially when combined with support/resistance and volume for confirmation.

Aug 04, 2025 at 05:35 am

Understanding Moving Averages in Crypto Swing Trading

Moving averages (MAs) are foundational tools used by traders to identify trends, time entries, and manage risk in the cryptocurrency market. For swing trading, which typically spans from a few days to several weeks, the right moving average settings help smooth out price noise and highlight the underlying trend. The most commonly used types are the Simple Moving Average (SMA) and the Exponential Moving Average (EMA). The EMA places more weight on recent prices, making it more responsive to new information—this responsiveness is often preferred in the volatile crypto market.

When selecting moving average settings, traders must balance sensitivity and reliability. A shorter period reacts quickly to price changes but generates more false signals. A longer period reduces noise but may lag behind sudden market moves. The optimal settings depend on the trader’s strategy, risk tolerance, and the specific cryptocurrency being traded. Assets like Bitcoin (BTC) and Ethereum (ETH) tend to follow more predictable trends compared to low-cap altcoins, which may require different configurations.

Popular Moving Average Combinations for Crypto Swing Traders

Many swing traders use dual moving average crossovers to generate buy and sell signals. Common combinations include:

• 9 EMA and 21 EMA: This pairing is highly responsive and ideal for short-term swings. A bullish crossover occurs when the 9 EMA crosses above the 21 EMA, suggesting upward momentum. Conversely, a bearish crossover happens when the 9 EMA crosses below the 21 EMA.
• 20 SMA and 50 SMA: This setup is slightly slower but filters out more noise. It works well on daily charts for identifying medium-term trends in major cryptocurrencies.
• 50 EMA and 200 EMA: Known as the “Golden Cross” and “Death Cross” setup, this combination is used to detect major trend reversals. While powerful, it often produces late signals in fast-moving crypto markets.

Traders often overlay these MAs on the daily (1D) or 4-hour (4H) charts. The 4-hour chart strikes a balance between noise reduction and timely signal generation. For instance, using the 9 EMA and 21 EMA on the 4H chart allows traders to capture multi-day moves without being whipsawed by intraday volatility.

How to Apply Moving Averages on Trading Platforms

To apply moving averages on platforms like TradingView, Binance, or KuCoin, follow these steps:

• Navigate to the chart of the desired cryptocurrency pair (e.g., BTC/USDT).
• Click on the “Indicators” button, usually located at the top of the chart.
• Search for “Moving Average” or “EMA” in the indicator library.
• Add the first moving average and set the period (e.g., 9) and type (EMA).
• Repeat the process to add a second moving average (e.g., 21 EMA).
• Customize the colors for clarity—commonly, the shorter MA is green and the longer one red.
• Adjust the settings to apply on closing prices and ensure the “on chart” option is enabled.

Some platforms allow saving templates. After configuring the MAs, save the layout so it can be applied to other crypto pairs instantly. This ensures consistency across multiple assets and saves time during analysis.

Using Moving Averages with Support and Resistance

Moving averages gain additional significance when they align with key support and resistance levels. For example, if the 50 EMA coincides with a historical price floor on the BTC/USDT chart, a bounce from that zone carries more weight. Traders can use this confluence to increase confidence in a trade setup.

To identify such confluence:

• Draw horizontal support and resistance lines based on previous swing highs and lows.
• Observe if a moving average, such as the 20 SMA, is approaching or touching one of these levels.
• Wait for price action confirmation, such as a bullish engulfing candle or a pin bar, near the intersection.
• Combine with volume analysis—rising volume on a breakout from the MA and resistance increases validity.

This multi-layered approach helps filter out false breakouts common in crypto. For instance, during a rally in Solana (SOL), if price breaks above the 50 EMA with high volume and clears a resistance level, it signals stronger bullish momentum.

Optimizing Settings Based on Market Conditions

Crypto markets shift between trending and ranging phases. During strong trends, shorter MAs like the 9 EMA perform well. In choppy or sideways markets, they generate frequent false signals. To adapt:

• Use the Average Directional Index (ADX) to determine trend strength. An ADX above 25 suggests a trending market where moving average strategies excel.
• Widen the MA periods during high volatility. For example, switch from 9/21 EMA to 13/48 EMA to reduce noise.
• On lower timeframes like 1H, consider using 21 EMA and 55 EMA for swing entries within a larger trend identified on the daily chart.
• Backtest different settings on historical data. For BTC, test 8 EMA/21 EMA vs. 10 EMA/30 EMA over the past year to compare win rate and drawdown.

Volatility also varies by asset. Cardano (ADA) may respond better to 15/35 SMA, while Dogecoin (DOGE) might need faster EMAs due to its pump-and-dump tendencies. Customization per asset improves performance.

Common Mistakes to Avoid with Moving Averages

Traders often misuse moving averages by overcomplicating setups. Common pitfalls include:

• Adding too many MAs on one chart, leading to confusion. Stick to one or two for clarity.
• Ignoring the broader market context. If Bitcoin is in a downtrend, bullish crossovers in altcoins may fail.
• Relying solely on crossovers without confirmation. Always check RSI, MACD, or candlestick patterns.
• Using default settings without testing. The “best” settings vary by timeframe and asset.

For example, a trader seeing a 9/21 EMA crossover on Polygon (MATIC) during a Bitcoin sell-off may enter long, only to face a sharp drop. Checking BTC’s trend first could prevent such losses.

Frequently Asked Questions

Q: Can I use moving averages on 15-minute charts for swing trading crypto?

While 15-minute charts are typically used for day trading, they can support swing trading when combined with higher timeframe analysis. Use 21 EMA and 55 EMA on the 15-minute chart, but confirm direction using the daily 50 EMA. Entries should align with the higher timeframe trend.

Q: Should I use SMA or EMA for less volatile cryptos like stablecoins?

Stablecoins rarely exhibit swing trading opportunities due to minimal price movement. If trading yield-based pairs or peg deviations, SMA is sufficient because price changes are slow and predictable.

Q: How do I know if a moving average crossover is a fake signal?

A crossover followed by price failing to advance more than 1–2% may be fake. Confirm with volume drop or a reversal candle like a doji. Also, if the crossover occurs far from support/resistance, it’s less reliable.

Q: Can I automate trades based on moving average crossovers?

Yes, platforms like 3Commas or TradingBot allow setting up bots that execute buys on EMA crossovers. However, include filters such as minimum volume and trend direction to avoid poor entries during consolidation.