As a name suggests. This forex strategy uses MACD forex indicator to gauge the trend and CCI as a signal. But there is more to the success of this trading system. To achieve the best results we double the MACD histogram. Also, CCI is used to measure the market momentum and is coupled with specific candle range.
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Take profit and stop loss are omitted. Instead strategy liquidates positions according to trailing stop. The TS is adjusted only in the positive trade direction on every candle close.
Strategy was tested for profitability on high quality historical data since 2003 and the same expert advisor trading this forex strategy is provided freely by theforexkings for our readers to thoroughly test this trading approach.
Forex strategy tools and indicators
Moving average convergence divergence (MACD). Histograms (500,250 and 250,100). Two histograms with different calculation period are used to identify trend. They compliment each other well. The slow one is more accurate in reading long term market situations, while fast promptly reacts to any turned changes or reversing trend momentum. This will help us to avoid trading on cycle end.
Commodity channel index (CCI 10). CCI will create a momentum signal. Indicators value moving to extreme overbought/oversold zone is a primary trading signal, with other one being a candle with specific size, closing in the direction of trend.
Big candle signal (40 to 150 pips). Candle with defined body range (min/max) closing in the direction of our MACD identified trend. We enter the trade on this candle close.
Trailing stop (add 30 pips extra deviation). Candle high/low is used for trailing stop. It is adjusted on each candle close only in the positive direction (direction of profitable trade). This is the only method of how to close a trade in this forex strategy.
Forex strategy rules
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Both MACD histogram s trending below zero.
CCI falling below -100 line.
Bearish candle with size (min max) closes. We enter the trade on new candle open. Trailing stop is placed on previous (signal candle) high + extra distance.
Both MACD histogram s trending above zero.
CCI rising above 100 line.
Bullish candle with size (min max) closes. We enter the trade on new candle open. Trailing stop is placed on previous (signal candle) low - extra distance.
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Disclaimer: Expert advisor was tested for profitability on historical data. All screen shots provided are displaying real results of the test. However past data will never guarantee future success. Every expert advisor needs to be tested properly on demo account. LIVE use only on your own risk. Read full disclaimer. TheForexKings Team does not give any financial advice. TheForexKings does not take any responsibility for any user’s investments and investment decisions. All rights reserved. Strictly for personal use.