Main photo Support/Resistance Levels And Oscillator Startegy

Support/Resistance Levels And Oscillator Startegy

  • By Chris Moris

Trading strategy with the use of support and resistance levels and the indicator MACD can be used for all currency pairs. Recommended timeframe – H1.

The settings for MACD indicator are as follows: fast EMA 12, slow EMA 26 and MACD SMA 9.

First of all, we construct support and resistance levels for the selected currency pair on the chart. A transaction can be opened after breakdown of the support or the resistance level provided that the candlestick opens either above or below the level of support/resistance. If a candlestick opens above resistance level, we open a buy transaction and likewise, when the candlestick opens below support level, we open a sell position.  

Fig. 1

Oscillator MACD is used to confirm a buy/sell signal. We shall trace the directivity of the lines of MACD oscillator. If, at the time when the price breaks down resistance level at least two line of MACD histogram will be directed upwards, we will get a buy signal and on the contrary, if at the time when the price breaks down support level, at least two lines of the histogram will direct downwards, it gives us a sell signal.

The fig.2 clearly shows the entry point for the buy position in accordance the described conditions.

Fig. 2

Chris Moris
Chris Moris

Risk Warning: Trading on Forex and Binary Options carries a high level of risk and it is not suitable for all investors.There is always a possibility of losing some or all of your initial investment, so you should not invest money which you can't afford to lose.Eventhough we Forex Stock Exchange Forum,does not provide any investment advice you should be aware of the risks involved. Any opinions, news, research, analyzes, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice.Forex Stock Exchange FORUM will not accept liability for any losses, which may arise directly or indirectly from use of information from our website.You trade at your own risk!

Recommended publications