Gerald Appel MACD Trendline Breakout “Forex & Stock” Trading Strategy

The MACD is one of the most powerful trend following and momentum indicator. The MACD is a commonly used technical indicator. As stated, the acronym stands for Moving Average Convergence Divergence.

 

Let’s move forward to the most important part of this trading strategy. the buy, or sell rules of the MACD Trendline Breakout Strategy.

Now, before we go any further, please take a piece of paper and a pen and note down the rules.

Let’s get started…..

 

• Download “ForexWOT-MACDtrendlineBreakout” (Zip/RAR File).
• Copy mq4 and ex4 files to your Metatrader Directory …/experts/indicators/
• Copy the “ForexWOT-MACDtrendlineBreakout.tpl” file (template) to your Metatrader Directory …/templates /
• Start or restart your Metatrader Client.
• Select Chart and Timeframe where you want to test your forex system.
• Right-click on your trading chart and hover on “Template”.
• Move right to select “ForexWOT-MACDtrendlineBreakout” trading system and strategy.
• You will see “ForexWOT-MACDtrendlineBreakout” is available on your Chart.

 

• Step #1: Wait for the MACD lines to develop a higher high followed by a lower high swing point.
• Step #2: Connect the MACD line swing points that you have identified in Step #1 with a trendline.
• Step #3: Wait for the MACD line to break above the trendline. Entry at the market price as soon as the MACD line breaks above.
• Step #4: Use Protective Stop Loss Order. Place the Stop Loss below the most recent swing low.
• Step #5: Take Profit when the MACD crossover happens in the opposite direction of our entry.

 

• Step #1: Wait for the MACD lines to develop a lower low followed by a higher low swing point.
• Step #2: Connect the MACD line swing points that you have identified in Step #1 with a trendline.
• Step #3: Wait for the MACD line to break below the trendline. Entry at the market price as soon as the MACD line breaks below.
• Step #4: Use Protective Stop Loss Order. Place the Stop Loss above the most recent swing high.
• Step #5: Take Profit when the MACD crossover happens in the opposite direction of our entry.

 

The MACD Trendline Breakout Strategy is a very simple trading strategy and yet a very profitable strategy at the same time. The success behind the MACD Trendline Breakout Strategy is derived from one simple principle, “momentum precedes price”.