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Friday, 23 August 2019

Trading with Parabolic SAR and MACD

This trading method is very simple and quite accurate. Can be used on all time frames, however the higher the time frame trading the more accurate it will be. The main factor needed is patience in waiting for trading signals, and the indicators used are only parabolic SAR (pSAR) and MACD.



. MACD standard settings (12, 26, 9). Wait until the MACD curve and signal curve intersect (MACD cross)
2. Default pSAR setting (step = 0.02 and maximum = 0.2). Observe whether the pSAR point on the chart has changed position.
3. If at almost the same time MACD cross occurs and changes in the position of the pSAR point, place a pending buy stop order at around the highest price of the current candlestick, or sell stop at around the lowest price of the current candlestick.

Point A: movement of the pSAR point changes position from the top of the price to the bottom of the price, which shows a signal for buy entry or a signal for exit sell.
Point B: Place a buy stop order as soon as the MACD curve crosses the signal curve from the bottom up (signal to buy), and the pSAR point changes position from the top of the price to the bottom of the price (A).
Point C: movement of the pSAR point changes position from below the price to the top of the price, which shows a signal for an entry sell or a signal for an exit buy.
Exit a buy position, and or place a sell stop order as soon as the MACD curve crosses the signal curve from the top down, and the pSAR point changes position from below the price to the top of the price (C).
Point D: Exit a sell position, and or plaace a buy stop order as soon as the MACD curve crosses the signal curve from the bottom up, and the pSAR point changes position from above the price to below the price.

ALSO READ : Here Is The Way Of Trading Without Indicators

4. If at almost the same time there is no MACD cross and pSAR point position changes, there is no order placement.
5. Stop loss can be determined at the nearest support or resistance level, and adjusted to the planned risk management.

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