This strategy combines the classic stochastic strategy to buy when the stochastic is oversold with a classic MACD strategy to buy when the MACD histogram value goes above the zero line. Only difference to the classic stochastic is a default setting of 71 for overbought (classic setting 80) and 29 for oversold (classic setting 20).
Therefore this strategy goes long if the MACD histogram goes above zero and the stochastic indicator detects a oversold condition (value below 29). If the inverse logic is true, the strategy goes short (stochastic overbought condition with a value above 71 and the MACD histogram falling below the zero line value).
Please be aware that this pure double strategy using simply two classic indicators does not have any stop loss or take profit money management logic.
All trading involves high risk; past performance is not necessarily indicative of future results. Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown.
The colour changes in the candlestick bar is a bit confusing, how should I interpret each colour? and is this better view in hourly timeframe or 5mins? it doesnt seem to give any signal in longer timeframe... Thank you
Raghadev89
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@M_M_M_M, Add a 12 EMA, 26 EMA and 100 SMA to your chart... My understanding is that the code is written in a way that when the candle is closed above all Moving averages mentioned, Candles will be Green. If candle is closed below all the moving average mentioned, Candles will be Red. If the candle is closed within any of the two or three moving averages the candle is displayed in Blue color which means No trade because the moving average can act as resistance and support or neither Bull nor bears are in hold of the stock... This method is really clean, Kudos to the coder... You do not have to add moving averages making your chart pretty dense with lines... Just by color change of the candle will help you to take a trade and chart is super clean... Let me know if others have diff thoguhts...
Reagrding timeframe, I see that it works in all timeframes...
M_M_M_M
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@Raghadev89, Thanks for the input :) But i find this signal tad bit hard to comprehend and used to the standard 26/9 MACD and 20/50/100 EMA as guidance.
jackturner
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Hey, thanks for sharing the strategy. I am just wondering if there is any way to change those +/- 2 on trading signals to 0 so that the signal is shown exactly when it should be executed?
mrdaxman
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Hello, does this repaint? Thanks
ChartArt
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@mrdaxman, This "MACD + Stochastic" strategy does not repaint.
TradinOptions
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cannot add this to my chart,having trouble with some scripts that wont post to your charts when adding to favorites
BozhidarKobakov
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The strategy shows promising results, however it takes only 2 trades for like a week?
MrStrategy
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could be possible to convert this to JavaScript?
Se99jmk
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The bar colour seems to only be doing the outline of the candles, which looks really confusing.
Is there something I need to switch off so the entire candle is the same colour?