1Hr Forex Trading Strategy With MACD

This 1 Hr Forex Trading Strategy With MACD is a trend trading system and as the name says, the timeframe you can use to trade this system in the 1hr.

This forex strategy may take a while to understand but have a close look at the charts below and you will understand that it is simple.

What currency pairs are suitable for the 1hr forex trading strategy with Macd?

Preferably the majors but you can also use this on others.

 

Forex Indicators You Need For The 1hr Forex Trading Strategy With MACD

You need the following indicators for this forex strategy:

  • 50 exponential moving average which you must apply to HIGH
  • 50 exponential moving average applied to LOW
  • 15 exponential moving average applied to CLOSE
  • custom indicator Macd-with-EMA, click to download (settings 35, 70, 1, 12), see below:

1hr Forex Trading Strategy With MACD

 

Selling Rules

  1. MACD histogram must be in right color, red for downtrend (or whatever color you chose on the custom MACD indicator)
  2. MACD Moving Average must be “within” the colored area of the MACD histogram
  3. When price goes up and hits the 15ema and bounces back down or goes up through the 15ema and reverses back it is a sell trade signal  as long as the following conditions are met: the low of the candlestick is not more than 50 pips away from the 15 EMA and 15 EMA must not be  “within” the 50 EMA channels.
  4. The trade setup candlestick is the candle that touches the 15 ema OR passes through it but makes a lower low, which means, it breaks the low of the previous candlestick. On this candlestick, you set a sell stop order 2-5 pips (allow for spread) below its low to catch the downward breakout of price move.
  5. Place you stop loss at 100 pips.
  6. Take profit target at 100 pips.
  7. Move trailing stop to break even at 50 pips.

This chart explains what it means to have the MA of MACD “within” the histogram (read lines etc), this is for a sell setup:

1hr Forex Trading Strategy With MACD

Here’s an example of a sell trading setup:

1hr Forex Strategy With MACD

Buying Rules

For buying, you do the exact opposite of what you do in sell setup, but here are the trading rules:

  1. MACD histogram must be in right color,green for uptrend
  2. MACD Moving Average must be “within” the colored green area of the MACD histogram
  3. When price goes down and hits the 15ema and bounces back up or goes down through the 15ema and reverses back it is a buy trade signal  as long as the following conditions are met: the high of the candlestick not more than 50 pips away from the 15 EMA and 15 EMA must not be  “within” the 50 EMA channels.
  4. The trade setup candlestick is the candle that touches the 15 ema OR passes through it but makes a higher high, which means, it breaks the high of the previous candlestick. On this candlestick, you set a buy stop order 2-5 pips (allow for spread) above its high to catch the upward breakout if it happens.
  5. Place you stop loss at 100 pips.
  6. Take profit target at 100 pips.
  7. Move trailing stop to break even at 50 pips.

 

Disadvantages of the 1hr Forex Trading Strategy With MACD

  • MACD and Moving Average are all lagging indicators, so there always the late entry factor right there.
  • the system will not perform well in a ranging market

 

Advantages of the 1hr Forex Trading Strategy With MACD

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