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(98% WINRATE) The MACD, Stockhastic Oscillator, and RSI Strategy


If you’re seeking a comprehensive trading strategy that encompasses all current market conditions, then this is the strategy you need. By understanding and implementing this trading strategy, I’m confident that you can triple your trading accuracy.

Trading NOTES

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Moreover, grasping the thought process and analytical approach behind this strategy will enable you to develop new trading strategies tailored to your needs and trading style. So, without further ado, let’s get started.

The Stochastic (identifying overbought and oversold levels)

It consists of two lines: the K-Line (blue), which represents the closing price, and the D-Line (orange), which is the moving average of the K-Line. Paying attention to these lines is key for making informed trading decisions.

The stochastic serves as a primary entry signal for traders. Monitoring the ranges within which the lines move helps determine whether an asset is oversold or overbought.

When the K-Line (blue) falls below 20, marked in yellow, it suggests a buying or long signal as the asset is oversold. Conversely, when it surpasses the 80 mark, shown in red, it indicates a selling or shorting opportunity as the asset is overbought.

While the stochastic can be used independently by buying in oversold regions and selling in overbought regions, this approach typically yields a low success rate. Therefore, it’s essential to combine stochastic analysis with other indicators or strategies for more reliable trading outcomes.

The RSI (trend confirmations)

The Relative Strength Index, or RSI, is a widely used tool in trading for confirming trends.

While it’s common to use RSI to identify overbought and oversold conditions, there are other indicators like the stochastic for that purpose. Instead, we can utilize RSI to confirm trends when combined with other tools.

In this approach, I adjusted the RSI settings to a single line at 50.

  • When the RSI is above this line, indicated by the green line, it suggests an upward trend, signaling a potential buying opportunity.
  • Conversely, when the RSI falls below the middle line, it indicates a downtrend, prompting consideration for selling.

It’s essential to note that there are various ways to use the RSI indicator, and in this demonstration, we’re focusing on its role in confirming trends.

MACD (detecting momentum)

MACD, short for Moving Average Convergence Divergence, serves as a crucial tool for detecting momentum in trading. Acting as a momentum indicator, it provides insights into price trends and market directions. The MACD is calculated by subtracting the 26-day moving average from the 12-day moving average of the price.

A popular strategy involving the MACD revolves around crossovers. When the MACD line (shown in blue) crosses above the signal line (depicted in orange) – as highlighted in green – it indicates a potential buying opportunity. Conversely, when the MACD line crosses below the signal line, it suggests a sell position.


However, it’s important to note that this strategy is most effective in trending markets; during sideways movements, the MACD may generate false signals.In this combination of tools, we’re not solely relying on MACD crossovers. Instead, it serves as a third layer of confirmation, ensuring that the momentum of the market aligns with our trading decisions.

How to install the “TraderVersity-TripleThreatStrategy
  • Download “TraderVersity-TripleThreatStrategy” (Zip/RAR File).
  • Copy mq4 and ex4 files to your Metatrader Directory …/experts/indicators/
  • Copy the “TraderVersity-TripleThreatStrategy.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 “TraderVersity-TripleThreatStrategy” trading system and strategy.
  • You will see the “TraderVersity-TripleThreatStrategy” is available on your Chart.
Buying Rules (Long position):

  • Step 1: Look at stochastic, then make sure both K and D lines are in oversold regions.
  • Step 2: Use RSI to confirm the upward trend by making sure it is above the middle line (or 50 level).
  • Step 3: Use the MACD to confirm the upward movement. You have to make sure the MACD line crosses above the signal line.
  • Step 4: Ensure that both of the stochastic lines has not hit overbought levels yet.
  • Step 5: Take a buy/long position.
Selling Rules (Short position):

  • Step 1: First look at stochastic, then make sure both K and D lines are in overbought regions.
  • Step 2: Use RSI to confirm the downward trend by making sure it is below the middle line (or 50 level).
  • Step 3: Use the MACD to confirm the downward movement. You have to make sure the MACD line crosses below the signal line.
  • Step 4: Ensure that both of the stochastic lines has not hit oversold levels yet.
  • Step 5: Take a sell/short position once all rules are met.
Trading NOTES

Not all strategies are foolproof and guaranteed. There’s always a chance for indicators to stray from anticipated outcomes, even after meticulously checking off all the points on the list. Greater forces are always at play.

Nevertheless, in this analysis, you’ve honed in on crucial technical facets of the market, like pinpointing whether the market is overbought or oversold, validating the prevailing market trend, and gauging momentum.

Furthermore, you can bolster your analysis with price action methods such as identifying support and resistance levels, drawing trend lines, recognizing chart patterns, and interpreting candlestick patterns to refine your trading signals

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