198# Multi MACD Scalping
Multi MACD Scalping with EMA
Trading intraday with multi MACD as filter
Submit by Lorenz 04/2017
Multi MACD Scalping is a trend following strategy for intraday trading based on MACD and Exoponential Averages multi timeframe. This strategy it's alxo good for trading with binary options high/low expiry time 30 min-45- min time frame M1 and M5.
Set up a sales template
In the time interval M1, we will use indicators with such settings:
The MACD histogram should have settings (13.21 SMA 1) - apply the coloring to red;
Histogram of the MAK indicator with settings (21,34 SMA 1) - set the color to orange;
Histogram of the MACD indicator with settings (34.144 SMA 1) - make it green in color.
In addition, on the chart of the EURUSD currency pair we plot EMA indicators with the following parameters:
Indicator Exponential MA (period 21) - painted in red;
Indicator Exponential MA (period 34) - painted in orange;
The indicator Exponential МА (period 144) - painted in green color.
The established exponential averages should be applied to closing prices (CLOSE).
After setting the timeframe M1, that is, setting all the above indicators on it, we need to configure the timeframe M5, which should contain the following indicators with such parameters:
The MACD trend indicator with us needs to be set with such settings (21,34, SMA 1) - the histogram of the indicator itself, we paint it in green color.
In addition, on the chart of quotations EURUSD of the timeframe M1, we impose exponential sliding, with the following parameters:
Indicator Exponential МА (period 21) - color in red color;
Indicator Exponential МА (period 34) - we paint in orange color;
Indicator Exponential МА (period 144) - we paint in green color.
The installed moving averages must be applied to closing prices (CLOSE).
Stage 1. Analysis of the EURUSD chart on the M1 timeframe
This stage starts from the receipt of the primary signal - intersection with the histogram MACD (parameters 13,21 SMA 1) of the zero level on its scale. If the MACD histogram has broken the zero mark from the top to the bottom, we should be ready to open the Put-option deal. At the reverse crossing of the level - in the direction from below - upwards, we conclude the deal - Call-option (that is, we buy). We note that this intersection is a rather unstable signal and we need to confirm it with the signals of all the indicators listed above, since the intersection itself is just a "beacon" of the fact that we need to be ready for further evaluation of all indicators.
Thus, within the framework of M1, a number of events are to be confirmed, confirmed by all listed indicators, so that they can be regarded as a clear signal for the conclusion of an order by a binary option:
It is necessary that the histograms of the MACD indicators (with the settings 21,34 SMA 1) - orange, MACD (with settings 34,144 SMA 1) - green, MACD (settings 13,21 SMA 1) - red, punched in the same Direction its zero marks;
The price must break through all three exponential averages.
If, however, one of the above conditions is not met, we must make a "hang-over" of the trade and wait for the next signal. This is important for the discipline of trade and will protect our deposit from losses and premature false entries into the market.
Step 2. The signal on M5
If we received a confirmed trade signal on M1, we need to consider M5 to make sure that our transaction will not conflict with the rules of the system. So - on M1 we get trading signals, and on M5 we confirm them. At the same time, M5 must meet the same requirements as for M1. That is, the MACD histogram must pass the zero level in the required direction, and the price should close behind the three control indicator removals (EMA). It does not matter when the signal on the M5 was received a little earlier than on the M1. The main thing is that thanks to M5 we will see that we conclude deals in the necessary direction.
Stage 3. Transactions by a classic binary option
In order to open a call-option transaction (purchase), it is necessary that the price quotations for M1-M5 strike up three lines of Exponential MA. At the same time, the histogram of the four MACDs must be above their own zero marks.
To conclude the Put-option transaction, we need the price to break three Exponential MA removals down, and the histograms on the four control MACDs are placed below the zero mark.
Important! Trade is possible only during the work of European and American trades, when the market of the EURUSD currency pair is the most volatile. Otherwise, we will receive losses, since this system requires activity and mobility from the financial asset.
EXPIRATION DATES for Binary Options High/low
As it was said before, the term of expiration of options should be at least 45 minutes. At the same time, when identifying trade signals on other timeframes, expiration terms will need to be replaced by older ones. For example, if you look at the signals not on M1 and M5, but on the charts, H1 and H4, then the expiration time will need to be set at least 6 hours.
Profit Target for M1 and M5 8-20 pips depends by Currency Pairs.
In the pictures Multi MACD Scalping in action.