Momentum Trading Strategy
This article explores the MACD + RSI trading strategy and how it can be effectively employed to identify trade opportunities in the forex market.
New and Simple Trend Strategy
2023-03-16 • Updated
As we know, strong trend movements are important on the market. We present you a trending strategy that will allow you to identify the very beginning of a solid incipient trend and open a deal.
Strategy setups
Instruments: any
Indicators: MACD (12,26,9), Parabolic SAR (0.02; 0.2) and SMA (period 10) with the default settings
Timeframe: >H1
Risk management rules: Fixed trade volume with 0.1 lot.
Rules for a long entry
- Wait for the MACD line to cross the signal line upwards.
- At the same time, a Parabolic SAR point appears at the bottom of the candle.
- Confirmation is when the price chart crosses the moving average upwards.
It is recommended to use a Stop Loss at the level of the nearest local minimum before receiving the signal.
Rules for a short entry
- Wait for the MACD line to cross the signal line downwards.
- At the same time, a Parabolic SAR point appears on top of the candle.
- Confirmation is when the price chart crosses the moving average downwards.
It is recommended to use a Stop Loss at the level of the nearest local maximum before receiving the signal.
Rules for a Take Profit
- The choice of Take Profit is possible based on the ratio 3:1, i.e., for one lost profit point, a deal should bring 3 points of profit.
- A trade can be closed before Take Profit is achieved if opposite signals from the MACD indicator and/or Parabolic SAR are received.
Important remarks
When searching for signals, it is important to pay attention to how the MACD lines are crossed. The sharper the crossing (the more substantial the "angle of attack"), the greater the chance of a successful signal. Typically, the angle of attack depends on how far the MACD lines deviate from each other before they cross.
The MACD+Parabolic indicators can be combined with other types of technical analysis. For example, with chart analysis and support/resistance levels. If the buy signal appears when the price tests support levels, the probability of a successful transaction increases. The same is true for the sell signal at resistance levels.
Trade with FBS using MACD and Parabolic and become a true professional!
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The procedure is very straightforward. Go to the Withdrawal page on the website or the Finances section of the FBS Personal Area and access Withdrawal. You can get the earned money via the same payment system that you used for depositing. In case you funded the account via various methods, withdraw your profit via the same methods in the ratio according to the deposited sums.
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How to open an FBS account?
Click the ‘Open account’ button on our website and proceed to the Personal Area. Before you can start trading, pass a profile verification. Confirm your email and phone number, get your ID verified. This procedure guarantees the safety of your funds and identity. Once you are done with all the checks, go to the preferred trading platform, and start trading.
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How to start trading?
If you are 18+ years old, you can join FBS and begin your FX journey. To trade, you need a brokerage account and sufficient knowledge on how assets behave in the financial markets. Start with studying the basics with our free educational materials and creating an FBS account. You may want to test the environment with virtual money with a Demo account. Once you are ready, enter the real market and trade to succeed.
