MACD_2ToneColor Indicator For MT4
The MACD_2ToneColor Indicator For MT4 is the simplicities version of the traditional MACD indicator. This indicator is mostly used by the naïve traders since the graphical data display allows them to find highly accurate trade setups. Blue bars above the reference line 0, showing bullish momentum and red bars below the reference line 0, shows selling pressure. But to get the best result you need to use this tool in a higher period.
The MACD_2ToneColor Indicator For MT4 is a sequential trade filter tool depending on three unique metrics. The initial calculation is done with the help of fast and slow EMA with periods 12 and 26 respectively. For the signal line calculation, the indicator uses SMA period 9. Though you can change the value of the period for this indicator, it is recommended you rely on the default settings. Start using this indicator to take the trades in the major currency pairs. As you learn about the proper use of this indicator, you can slowly learn to take the trades in any asset.
The indicator reading is shown in the form of colored bars. Red and blue bars are formed in an oscillating pattern. Blue bars on the top side of the baseline indicate the bull’s strength. On the contrary, red bars below the reference line suggest a bearish trend. To measure the market volatility, you can use the distance between the blue signal line and the colored bars. If the distance is high, the volatility is extreme. But if you see the bars are forming while the blue signal line is acting as a boundary, you can expect rational movement in the price.
Trading ideas with the MACD_2ToneColor Indicator For MT4
The function of any indicator is strictly limited to the trade filtering process only. Sadly, most rookies start depending on the indicators by ignoring the basic readings. But by doing so, you are imposing a great risk to your trading career. MACD_2ToneColor Indicator is a helping tool that will give you the confirmation that a certain trade setup is valid and holds the potential to generate profit. So, you can clearly understand, without having a strong strategy, there is no use of this premium MACD_2ToneColor Indicator. Those who have already develop a trading method, need to ensure that their system is capable of winning more than 65% of the time. If not, they need to revise or create a new trading system.
Developing a new strategy from the scratch is not an easy task. You have to move to the demo account and find a precise way to determine the major SR levels. We recommended the novice traders to work on a higher time frame since it increases the chance of making a decent profit. Those who are creating the system from the scratch has the unique chance to integrate the MACD_2ToneColor Indicator. Before you start integrating the MACD_2ToneColor Indicator into the system, you must know how this tool is used to take long and short trades.
MACD_2ToneColor Indicator For MT4 - Buy Entries
To the professional traders, the buying signals are generated at the break of resistance and at the major support zone. Taking new long trades by analyzing the breakout is a tough task and requires prompt action from the trader's end. So, we encourage the traders to look for the buying signal at the key support level. People who are skilled with price action signals can easily find the long trade setup by analyzing the bullish rejection of the candle. During that time, MACD_2ToneColor Indicator should show blue bars on the positive side of the reference line.
In case you wish to open the trades at the breakout, you have to analyze the blue signal line from the MACD_2ToneColor Indicator. Since the breakout of a certain resistance level requires the volatile state of the market, you need to observe the MACD_2ToneColor Indicator from a different angle. The blue bars must be present on the positive side but the blue signal line will be in a higher position. This means the blue signal line will be hovering above the blue bars created by the MACD_2ToneColor Indicator. The bigger the gap between bars and blue signal, the better chance you have to earn money by taking the long order at the bullish breakout.
MACD_2ToneColor Indicator For MT4 - Sell Entries
Smart traders must have guessed, the red bars in the MACD_2ToneColor Indicator is the confirmation signal to take the short trade. After finding the desired bearish price action signal at the resistance level, you can look for the confirmation signal from the indicator panel. There will be red bars on the negative side of the indicator panel. Note that the red bars must show a gradual increase in their length. The gradual increment tells us the sellers are slowly getting stronger.
Now come to the news trading method. Traders who are looking to integrate the MACD_2ToneColor Indicator to deal with the major news need to be careful about the blue signal line. If you take a short trade, the slope of the blue signal line must be negative. In short, the direction of the blue signal line also suggests the direction of the trend. So, if you open a short trade by getting red bars in the MACD_2ToneColor Indicator while the signal line is in the rising mode, you are making a big mistake. News traders should give priority to the signal line first and then take the reading from the colored bars.
MACD_2ToneColor Indicator For MT4 - Conclusion
The success of a trader depends on many factors. Studying the core function of the MACD_2ToneColor Indicator can definitely give a clean road to take high-quality trades but this is not enough. You must follow a precise trading journal and open your trade with low risk. Most novice traders fail to adhere to the proper risk management factor as they get emotionally biased by seeing the high success rate of the MACD_2ToneColor Indicator. Before you start using the MACD_2ToneColor Indicator, be determined that you will never break the rules.
Being an active trader, you should be aware of the casualties. Expecting to win money from most of the trades is not going to work since the results out random at trading. The use of MACD_2ToneColor Indicator is going to aid you by improving your performance. So, people who have a strong and well-balanced trading edge are most likely to do better in the long run. Learning the proper use of the MACD_2ToneColor Indicator is a means to improve your trading accuracy. But to see a significant change in your trading career, you have to ensure that the system which you are using is well balanced.