The BEST “MACD, Stochastic and RSI” Trading Strategy Nobody Told You About. In this tutorial will teach you a clear and precise step by step on, “How to trade successfully in Forex, Stocks and Commodities or any financial market and make consistent profits with absolutely minimal risk of stop losses”.

- DOWNLOAD these NON-REPAINT Tools For Making The Perfect Trade Entry (the best trading tools all traders MUST HAVE)
- Use a demo account or a small live account first to practice this trading system
So, by the end of this tutorial you’ll know exactly when to enter high-probability trades with very low stop loss risk using the perfect settings and combination of the MACD, Stochastic, and RSI indicators.
A stochastic oscillator is a momentum indicator that compares a security’s closing price to its price range over a set period. Similar to the MACD, the stochastic oscillator features both a fast-moving and a slow-moving metric.
So, Here’s how it works:
- Overbought Condition: When the stochastic oscillator reading is above 80, it signals that the asset might be overbought. This typically suggests that the price has risen too quickly and may soon experience a pullback or correction.
- Oversold Condition: Conversely, when the reading falls below 20, it indicates that the asset might be oversold. This often means the price has dropped too quickly and might be due for a rebound or upward correction.
In essence, these thresholds help traders gauge potential reversal points by showing when an asset might be priced too high or too low compared to its recent price history.
Now that you know the most popular way to use the Stochastic Oscillator, there’s one more important thing to learn: the best and most commonly used setting by pro traders and major investors. That’s the 14-period Stochastic Oscillator.
Yes, you heard it right. This 14-period setting is a key strength of the indicator and is crucial for accurate trading.
The Relative Strength Index (or RSI) is a key technical indicator used to analyze the strength or weakness of a market based on recent closing prices. It helps identify overbought and oversold conditions, but since we already have the Stochastic Oscillator for that, we’ll use the RSI for confirming trends in our strategy.
Here’s how it works: we adjust the default RSI setting to an 8-period RSI and pair it with a 14-period Moving Average. The 8-period RSI is perfect for tracking short-term price movements accurately. Based on my experience, an 8-period RSI provides the best statistical range for understanding short-term market trends.
The 14-period Moving Average tracks the market’s short-term movement, which aligns with the Stochastic Oscillator settings that institutional traders and major investors use.
Using the 8-period RSI with the 14-period Moving Average is simple but highly accurate for early trend detection.
- If the RSI line is below the 14-period Moving Average, it generally indicates a short-term bearish trend.
- Conversely, if the RSI line is above the 14-period Moving Average, it suggests a short-term bullish trend.
So, Anything above the black line, or above the 14-period Moving Average, would be a buy signal because it is an upward trend. On the other hand, anything below the black line, or above the 14-period Moving Average, shows the price on a downtrend, so you would take a sell position.
Remember, there are various ways to use the RSI, but in this ‘Triple Threat Trading Strategy,’We use it to confirm short-term trade signals when the market moves out of overbought or oversold zones.
Once you understand how to read these signals, it’s crucial to check that the medium-term trend aligns with your signals. This is why the ‘Triple Threat Trading Strategy’ is so accurate for scalping, intraday trading, swing trading, and long-term investing. Next, I’ll show you how the MACD indicator can help with this, ensuring you can rely on it to maximize profitability in any trading strategy.
The MACD (Moving Average Convergence Divergence) is a momentum indicator that helps identify price trends and market direction. It works by subtracting the 26-day moving average from the 12-day moving average.
A popular way to use the MACD for medium-term trends is by looking at the histogram. It’s simple but highly accurate for determining market trends in both Forex and stocks.
- If the MACD Histogram is above the center line (or zero line), the market is considered bullish in the medium term.
- Conversely, if the MACD Histogram is below the center line, the market is bearish in the medium term.
With this understanding, you can see why the ‘Triple Threat Trading Strategy’ is so reliable for accurate trading signals. Next, I’ll show you how to combine all three indicators to generate high-accuracy trade signals with minimal stop loss risk. This will increase your chances of long-term success.
- Download “TraderVersity-MACD(stochastic)RSI” (Zip/RAR File).
- Copy mq4 and ex4 files to your Metatrader Directory …/experts/indicators/
- Copy the “TraderVersity-MACD(stochastic)RSI.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-MACD(stochastic)RSI” trading system and strategy.
- You will see the “TraderVersity-MACD(stochastic)RSI” is available on your Chart.
Let’s start by finding a BUY signal with the ‘Triple Threat Trading Strategy’.
Here are the rules for entering a BUY trade.
- **Step 1:** Check if the MACD Histogram is above the zero line. This shows the market is in a bullish phase, which is our starting point. We need to confirm that the medium-term trend is strong. Once we verify the bullish trend, the buy signals from the Stochastic Oscillator and RSI will have a higher chance of success with minimal stop loss risk.
- **Step 2:** Next, make sure the Stochastic Oscillator is in the oversold area. If the MACD Histogram is above zero but the Stochastic Oscillator is still oversold, it suggests the current price drop is likely temporary, and the market will soon continue its bullish trend. Watch for the Stochastic Oscillator to move out of the oversold zone or cross above the level of 20.
- **Step 3:** Next, wait for the RSI line to cross above the Moving Average line. This confirms that the recent bullish signal is strong, increasing the likelihood that prices will rise significantly. This is why the ‘Triple Threat Trading Strategy’ is considered highly effective and reliable for or long-term success.
- **Step 4:** Finally, place a BUYL order on the next candle and set your stop loss just above the nearest swing low.
Here are the rules for entering a SELL trade.
- **Step 1:** First, check if the MACD Histogram is below the zero line. This shows the market is in a bearish phase, which is our starting point. We need to confirm that the medium-term trend is strong. Once we verify the bearish trend, the SELL signals from the Stochastic Oscillator and RSI will have a higher chance of success with minimal stop loss risk.
- **Step 2:** Check if the Stochastic Oscillator is in the overbought zone. If the MACD Histogram is below zero but the Stochastic Oscillator is rising into overbought territory, it suggests that the current price spike is likely temporary, and the market may soon return to its bearish trend. Watch for the Stochastic Oscillator to move out of the overbought zone or drop below the 80 level.
- **Step 3:** Wait for the RSI line to cross below the Moving Average line. This signals that the bearish trend is strong and likely to push prices significantly lower.
- **Step 4:** Finally, place a SELL order on the next candle and set your stop loss just above the nearest swing high.
This is a very powerful and reliable trading strategy. The only reason you might lose in the market is if you don’t stick to the trading rules outlined in this strategy. The combination of the RSI, Stochastic Oscillator, and MACD indicators is also easy to implement across all trading platforms, as these indicators are commonly available.
The Best Way to Combine EMA and Trendline for Scalping and Swing Trading.
This strategy is straightforward yet remarkably accurate. Our focus today is on the 50-period EMA trading strategy, which combines the Exponential Moving Average indicator with trend lines to enhance its reliability.
By combining these customized settings for the RSI and CCI, traders can gain a better understanding of market conditions and make more informed trading decisions.
Simple and high accuracy “Forex Cynthia Signal Trading System” – Of course, not every trade will be profitable, there is no holy grail in Forex.
- Cynthia’s Signal Entry Stop: Magenta color
- Cynthia’s Signal Hot Dots: Red color
- Cynthia’s Trend Bars: Magenta color
- Trend Slope: Magenta color
- BBand Stop: Magenta color
- Cynthia’s i Trend: Green line < Purple line
- RSI: Below the level 45 line