Results 1 to 9 of 9
  1. #1
    Rookie Member

    MACD Best Entries? !!!

    I went through BOTS Pre School, then went through BOTS Primary School.... It was a fantastic way to learn... Great job, and thanks for doing it! If I had one tiny complaint, it would be that putting Not Recommended Strategies in the leessons and tests, just clouds things up a bit. Perhaps there should be a seperate deal to educate people to stay away from those strategies, but not spending to much time having to learn them too, so you can pass the test.

    O.K., I threw in $200, and opened a Stock Pair account per your advice on BOTS! Works great, and easy to use.

    Since Tuesday, I have done 41 trades, including one for a $100 where I forgot to change the asset.. DOH! That one hurt.
    I have won 23 of them. My balance as been as high as $388, and as low as $41. I am currently sitting at $167.

    MAN, do I need disipline. When I follow strategies to the letter, and concentrate just on that, I win most of the time! When I just rush into something on usually more "hunch", than strategy, I lose most of the time.

    My question is about the MACD Best Entry Strategy. I have been using it, along with RSI, and the 123 Strategy.
    It is recommended to use 5 minute charts. With that said, am I trying to use 5 minute expiry as well, or should I be looking longer??
    Thanks!

  2. #2
    Legendry Member Michael Hodges's Avatar
    First, 5 minute charts are hard to predict, the shorter teh time frame the shorter the analysis will last and the more affect news and other events can affect it as well.

    The thing to do is to look at the charts and count how many bars it takes for your signal to produce a win, and then how many bars the asset stays in the money after that. I like to keep a table of these numbers for the charts I trade so that I know on average the minimum amount of expiry and maximum amount of expiry for each signal. For example; if i was trading the 5 minute chart and each signal took at least 4 bars to develop into a winning trade and then it would mean that I would want at least 20 minutes of expiry, probably a little longer but not too much? Does that make sense?

  3. #3
    Junior Member
    I have been learning this strategy and willing to apply it; however i have few questions: -

    1- i just want to confirm that when setting the SMA (the 50 and the 100) i leave the default setting of "shift" on 0 and "apply to" on close...is that right?
    2- the entry point is signaled by the MACD oscillator when it is on the overbought side (does this mean over the 0 level) (in a bearish trend of course) does this mean that the HISTOGRAM should be over the zero level or does it mean that the TWO LINE CURVES crossover above the zero level?
    3- Michael, could you please explain more on how you determine the expiry time by counting the candles, that one flew over my head...thank you..do you recommend another timeframe instead of the 5min for this strategy a longer one maybe to get rid of the noise
    4- what are the recommended OTHER indicators i can add to this strategy to confirm the trend AND to confirm the entry signal? anyones better than others?

    thanks

  4. #4
    Junior Member
    kindly check the attached picture... i followed the strategy and it failed (demo account no worries) i placed a put when the lines crossed over the 50SMA is below the 100SMA but the candles rocketed up. Click image for larger version. 

Name:	eurusdm5.jpg 
Views:	53 
Size:	19.0 KB 
ID:	1035 i want to understand was it my fault or is it "sometimes the best strategies suck sometimes" ?

  5. #5
    Legendry Member Michael Hodges's Avatar
    Quote Originally Posted by akrambr View Post
    kindly check the attached picture... i followed the strategy and it failed (demo account no worries) i placed a put when the lines crossed over the 50SMA is below the 100SMA but the candles rocketed up. Click image for larger version. 

Name:	eurusdm5.jpg 
Views:	53 
Size:	19.0 KB 
ID:	1035 i want to understand was it my fault or is it "sometimes the best strategies suck sometimes" ?
    First, everystrategy sucks sometimes.
    SEcond, if I am understanding you right you bought a put when the long green candle moved up into the range between the two moving averages? Is this right? Im talking about the 14th candle from the left. let me know if this is right and then I will answer you. If not also let me know so I can give a better answer than the one I am formulating now, ok?
    third, if you are using a chart of 5 minute candles and it takes four to 6 candles for you signal to produce a winner that means it takes 20-30 minutes for a trade to profit. If that is the case then an option with 60 seconds, 5 min or 10 minutes is too short. An options with 1 hour or more could be too long, an options with about 20-30 minutes, up to an hour could be just right. Capiche?
    4, you can use stochastic, trend lines, Zig Zag indicator and/or multiple time frame anlaysis. I recommend all of the above, determine the trends and then always trade with the trends. the trend is your friend

  6. #6
    Legendry Member Michael Hodges's Avatar
    And I don't typically use MACD histogram peaks to determine overbought/oversold levels by themselves. I like to look at the peaks over the past 12 months (day charts) or the past 5 years (weekly charts) and compare the height of the current peak looking for extremes (very bullish or bearish) and convergence/divergence with trend. I use stochastic for ob/os,

  7. #7
    Junior Member
    Quote Originally Posted by Michael Hodges View Post
    First, everystrategy sucks sometimes.
    SEcond, if I am understanding you right you bought a put when the long green candle moved up into the range between the two moving averages? Is this right? Im talking about the 14th candle from the left. let me know if this is right and then I will answer you. If not also let me know so I can give a better answer than the one I am formulating now, ok?
    third, if you are using a chart of 5 minute candles and it takes four to 6 candles for you signal to produce a winner that means it takes 20-30 minutes for a trade to profit. If that is the case then an option with 60 seconds, 5 min or 10 minutes is too short. An options with 1 hour or more could be too long, an options with about 20-30 minutes, up to an hour could be just right. Capiche?
    4, you can use stochastic, trend lines, Zig Zag indicator and/or multiple time frame anlaysis. I recommend all of the above, determine the trends and then always trade with the trends. the trend is your friend
    Michael, i placed a put on the 5th candle from the left (when the curves crossed above the 0 level)..from your reply i sense that i got the whole strategy all wrong. didn't I?

  8. #8
    Legendry Member Michael Hodges's Avatar
    Maybe not all wrong. It looks like that could have been a good entry for a put, it was in the money for a while. I think if you look at that same chart, mark where the big move up started and then move out to a longer time frame you may find something interesting, like a support zone, moving average or Fibonacci retracement which provided the boost in prices seen in the middle of the chart.

  9. #9
    Legendry Member Michael Hodges's Avatar
    Quote Originally Posted by Michael Hodges View Post
    Maybe not all wrong. It looks like that could have been a good entry for a put, it was in the money for a while. I think if you look at that same chart, mark where the big move up started and then move out to a longer time frame you may find something interesting, like a support zone, moving average or Fibonacci retracement which provided the boost in prices seen in the middle of the chart.
    Also look at where you took your signal, it did not move into the money for four bars and then stayed in the money for 5 bars, an expiry of 5 minutes did not work but one with 20-45 minutes would have....

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
3