Daily MACD Forex Trading Strategy

In order to open and close trades the same day, an effective intra-day trading strategy is required.

The Daily MACD forex trading strategy is an effective intra-day strategy built around the MACD indicator and some other technical indicators.

Each indicator acts separately (spot resistance/support areas, smoothen price, measure oversold/overbought zones and define trends respectively) to yield a combined desired results.

This strategy can be used for scalping (M1, M5) and day trading (M15, M30, H1).

Chart Setup

MetaTrader4 Indicators: Vidya_zone_2.ex4 (Default Setting), Xma.ex4 (Inputs Variable Modified; period=36, porog=4), Robby DSS Forex.ex4 (Inputs Variable Modified; EMA_period=38, Stochastic_period=30), MACD (Default Setting)

Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minute, 30-Minute, 1-Hour

Recommended Trading Sessions: Any (London, New York, Tokyo)

Currency Pairs: Any pair

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Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Initiate a buy entry if the following indicator or chart pattern gets put on display:

  1. If the red line of the Xma custom indicator intersects the dim gray line of the Vidya_zone_2 indicator in a bottom up manner (see Fig. 1.0), a buy trigger is said to be looming.
  2. If the dodger blue dotted dim gray line of the Robby DSS Forex indicator, plus red dots along the base of the indicator window gets put on display as shown on Fig. 1.0, a buy alert will suffice.
  3. If the green histograms of the MACD MT4 indicator gets aligned above the 0.00 level as depicted on Fig. 1.0, price is said to be driven higher i.e. a trigger to go bullish on the designated forex pair.

Stop Loss for Buy Entry: Place stop loss 3 pips below support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit if the following rules or conditions takes precedence:

  1. If price close below the red line of the Xma custom indicator during a buy alert, an exit or take profit is advised.
  2. If a red dot pops up on the dim gray line of the Robby DSS Forex indicator as illustrated on Fig. 1.0, an exit or take profit is recommended.
  3. If the green histograms of the MACD MT4 indicator readjust to get placed below the 0.00 level, it is a trigger to exit or take profit at once.

Sell Entry Rules

Enter a sell order if the following holds sway:

  1. If the red line of the Xma custom indicator intersects the dim gray line of the Vidya_zone_2 custom indicator in a top downward fashion as seen on Fig. 1.1, a sell trigger is said to be imminent.
  2. If the red dotted dim gray line of the Robby DSS Forex indicator gets put on display as exemplified on Fig. 1.1, a sell alert will do.
  3. If the green histograms of the MACD MT4 indicator gets aligned below the 0.00 level as shown on Fig. 1.1, price is said to be pushed lower i.e. a trigger to go bearish on the selected currency pair.

Stop Loss for Sell Entry: Place stop loss 3 pips above resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following takes to the fore:

  1. If price close above the red line of the Xma custom indicator while a sell signal is ongoing, an exit or take profit trigger is on the horizon.
  2. If a dodger blue dot pops up on the dim gray line of the Robby DSS Forex indicator as seen on Fig. 1.1 during a sell alert, an exit or take profit is advised.
  3. If the green histograms of the MACD MT4 indicator realigns to form above the 0.00 level, it is a trigger to exit or take profit immediately.

Sell Trade Example

Fig. 1.1

Free Download

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About The Trading Indicators

The Vidya_zone_2.ex4 is a custom indicator that consist of a series of three moving average lines that are best used in enhancing price smoothening.

The Xma.ex4 indicator for MetaTrader4 is a Moving Average that contains a digital filter used in spotting trends along with flat states in the market.

The Robby DSS Forex.ex4 is an oscillator indicator that blends stochastics and an exponential moving average to form oversold (below 20) and overbought (above 80) zones within its indicator window.

The Moving average convergence divergence (MACD) is a trend-following momentum indicator that reveals the connection between two moving averages of price.