MACD Pivot Point Free Expert Advisor
The third free EA offered by OneStepRemoved.com demonstrates the ability to customize indicators in order to create a unique strategy. Building custom indicators allows traders to further refine and develop their EAs. Often, custom indicators are a key component to many of the more advanced EAs. The strategy in this video is taken from the book â€œForex Conqueredâ€ by John L. Person. This strategy was built for MT5, unlike the two previous free EAs offered by OneStepRemoved.com.
This strategy is built to run on a fifteen minute chart with a major pair, such as the EUR/USD or USD/JPY. In this case the EA has been built to run on USD/JPY. This strategy is more complicated than the previous two free EA strategies offered by OneStepRemoved.com, and involves the creation of a unique indicator based on the MACD. This indicator is called the Exponential Moving Average of the MACD, or the EMA of the MACD. This strategy also uses Pivot Points to execute trades.
The buy and sell rules are based on passing two conditions. For the buy rule, the first condition is that the MACD is higher than the EMA MACD, which indicates the rate at which the pair is moving towards is increasing. You than compare the low of the last bar to the support or resistance level of the pivot points, and if it is within three pips of the support, the buy trade is automatically executed.
The sell rule is simply the inverse of the buy rule. If the EMA MACD is higher than the MACD, the first condition for a trade is met and the program proceeds to the next level of analysis. If the low of the last bar is within three pips of the resistance level, the trade is executed. For both buy and sell orders, a simple stop loss and take profit order is executed, with the take profit set to 40 pips by default and the stop loss set to 100 pips. These levels can be easily customized using Metatrader 4 for greater flexibility of the application.