- Parabolic SAR and
Currency Pair: Any
PARABOLIC SAR AND MACD FOREX TRADING STRATEGY RULES
- Wait for MACD line to cross-over. Once The MACD lines have crossed over then to to second step.
- Look To See If the Parabolic SAR has also switched position on the chart. If It does so then go to third step.
- Place A Buy stop/sell stop order above the high or low of the candlestick at the point where both the MACD & Parabolic SAR confirm trade entry signal.
- Place stop loss below the low or high of that candlestick-anywhere from 5-30 or so pips depending on what timeframe you are using as well-the larger timeframe you use, the stops may be a bit larger so you need to adjust your risk per trade accordingly.
- Exit The Trade when an opposite trade entry signal is given
DISADVANTAGES OF THE PARABOLIC SAR AND MACD FOREX TRADING STRATEGY
- in a ranging (sideways) market, you will get too many false signals which will cause you to get stopped out frequently.
- The MACD & Parabolic SAR are both lagging indicators so your trade entries are based on lagging information when price would have made a big move already and sometimes, at the spot and time where you enter, the price may be doing a temporary reversal.
- you stop loss may be quite large because if you place your stop losses quite close, you may get stopped out frequently.
READ MACD Crossover Forex Trading Strategy-In A Trending Market, This System Can Make You hundreds of pips Easily
ADVANTAGES OF THE PARABOLIC SAR AND MACD FOREX TRADING STRATEGY
It is a very simple and easy forex trading strategy to use especially for beginner forex traders
- you can easily spot the trade setups happening
- in a nice trending market, there’s potential to make a lot of profitable pips.
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