I really like this strategy. I played with it last week with stocks. I used 30 minute charts, MACD, 12/26/9, Candlesticks, Volume and 20,50,200 MA. The entry's seem to be great as you described. Entering on the first upward MACD bar WITH a bullish candle at a resistance/breakout point in the stock if you're going long. I used this as a short term strategy and my exit was the first lower bar posting on the MACD regardless of the candle (the candle seemed to always be bearish). I used associated a same size bar on the MACD as a lower bar and exited then too. It worked for me on all the trades I executed. I will continue to backtest, test and refine it though. I looked through 30 min. FX charts with and the price looked to be moving sideways duringsome MACD breakouts, as the MACD was lagging more on FX, just something else to investigate. Great Idea. Thanks.

Can you please explain exactly where you put your stop and take profit targets. thank you. Do you enter after the close of the bullish candle. Why is it lagging so much on the FX charts? What is a good way to test and see how lagging the indicator is? thank yo so much for your comments and help.

For the entry, I've been playing with entry ON the close of the candle ie: 30min bar 10, 10:30, 11 etc. or a minute or two before. As long as the candle is looking to close bullish, but what timeframe is sufficient for prejudging a candles close? As for stops, I haven't been using them for this perticular style. It seems as though once entering, it continued to rise until a LOWER or SAME LEVEL close on the macd bar, that was my exit. Again I am also in the piloting stages of this strategy, but fundamentally the MACD is following the momentum, as the MACD goes up, momentum goes up, price goes up. With forex, prices seemed to be spiking before a positive close on the MACD, but more analysis will be necessary. Thanks for your comments.

You are on the right track. MACD is a wonderful indicator for generally tracking changes in trend and movement of momentum in a particular direction. I use it in higher time frames to give me the strength of the trend and then drill down two or three levels (ie. I find MACD momentum on say a 30 minute chart, then drill down to the 10 minute to execute the pullback trade). The MACD provides good trend indication for the higher time frame and many of the pullbacks turn into winners and often find trades that "shoot out" from the pull back. I myself found MACD several months ago and love the indicator in the manner in which I use it.

Good luck and please keep us updated on your results.

It is going well i tested the strategy over 1k times on the forex tester software, a demo account and finally my live account. Thanks for the feedback it really helped and gave me a little more confidence while testing.

white94847 can you post a framework of your trading rules so we can incorporate it into our trading discipline?

The standard macd setting are good...Combine stochastics 13/3/3 as well....I include RSI standard settings....Keep in mind that fibonacci and S/R work together.....Some use pivot points.....they work about 60% of the time....Remember, the smaller time frames are driven by the larger....I like using Elliott Wave as a basis....If you like moving averages......5,12,89,200....Don't forget trendlines and watch for divergence...The only candle patterns should be used in OB/OS areas from the 30 minute to 4 hour....such as doji, morning star, hammers and such...The best trades occur when the is cross verification, or a combination of alignment....Never trade the inital news...wait until price calms down...