MACD Tape Indicator

The MACD Tape Forex Scalper indicator works on mt4 and delivers scalping trading signals. The indicator appears in the trading platform’s main chart pane. To trade with the MACD Tape Forex Scalper indicator, you could use your preferred trade entry, stop loss, and take profit strategy. Like with any indicator, you may want to trade in accordance with the broader trend and practice on a demo account initially until you completely understand it.

What is the MACD Tape Indicator?

MACD Tape Indicator is a short-term forex trading tool that can detect market patterns as well as trade indications. This indicator also contains arrow signs to help you comprehend the trade signals better. The MACD Tape Indicator can be used to trade all types of forex currency pairs in the financial market. Furthermore, its ease of use allows traders of any level of experience to quickly master it.

 

Setting up the MACD Tape Indicator
Setting up the MACD Tape Indicator

MACD Tape Strategy

The indicator employs a dual-band MACD to generate crossover signals that are used to characterize market trends. When a crossover occurs, the color changes automatically. You could also pay special attention to the indicator’s neutral/zero level because the indicator’s value is important in identifying market movements. When the indicator goes white with a positive value, it is a confirmation for a buy entry, and when it turns red with a negative value, it is a sell entry signal in line with the bearish market trend. You can better grasp the crossover signal direction by following its arrow indications in the main chart window.

Buy Signal

The following could be your checklist for a buy trade:

  • When the indicator turns white while carrying the positive value.
  • When an upward arrow appears below the candlesticks.

Once these events occur:

  • You could open a buy position after you confirm your entry with bullish candlestick patterns.
  • You could set your stop loss just below the nearest swing low.
  • You could set your take profit at the nearest resistance zone, or you could exit trade when the indicator turns red.
  • For good risk management, I would only consider trades with a risk to reward ratio of at least 1:2.
MACD Tape Indicator Buy Setup
MACD Tape Indicator Buy Setup

Sell Signal

The following could be your checklist for a sell trade:

  • When the indicator turns red while carrying the negative value.
  • When a downward arrow appears above the candlesticks.

Once these events occur:

  • You could open a sell position after you confirm your entry with bearish candlestick patterns.
  • You could set your stop loss just above the nearest swing high.
  • You could set your take profit at the nearest support zone, or you could exit trade when the indicator turns white.
  • For good risk management, I would only consider trades with a risk to reward ratio of at least 1:2.
MACD Tape Indicator Sell Setup
MACD Tape Indicator Sell Setup

MACD Tape Pros & Cons

Pros

  • The MACD Tape Indicator can be used in conjunction with any Forex Trading System to provide additional confirmation when entering or exiting a trade.
  • This indicator may help traders identify possible trend reversal and trend continuation zones.

Cons

  • Using this indicator may require additional knowledge of price action in order to benefit optimally.
  • This indicator may not meet the trader’s expectations in a narrow-ranging market on smaller timeframes.

Conclusion

The MACD Tape Indicator is well worth adding to your trading toolbox but keep your expectations in check. It, like any other technical analysis tool, is not capable of generating 100% correct indications. As a result, it will occasionally send out erroneous signals. Its performance will be highly variable depending on market conditions. You are free to create your own trading method based on it.

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