Trading has many variations. In this guide, we will talk about trading long intervals. It gives a high probability of winning, but you must be able to predict the direction of the market. Only then you can enter a trade and end up winning. I want to show you 3 indicators that will make it easier for you to foresee the reversal of the trend.
Key Takeaways🔑
| →Trading long intervals can increase the probability of successful trades. |
| →MACD, EMA, and Parabolic SAR can be used together to predict trend reversals. |
| →Adjusting the settings of these indicators can improve their effectiveness for your trading strategy. |
Contents
Set up MACD, EMA, and Parabolic SAR indicators on the Olymp Trade interface
After you have logged in, choose the Japanese candlesticks chart with a 5-minute interval. Then, you have to select every indicator separately. You do that by clicking the indicator icon and searching for the one you are interested in.
It is possible to adjust the settings of each indicator so they respond to your requirements. For the strategy described here, set your parameters accordingly: EMA 10, MACD 12, 26, and 9 so you will have them set exactly like in the above picture.
How to trade with MACD, EMA, and Parabolic SAR on the Olymp Trade platform
A given combination of indicators is perfect for the reversal trend trading. You have to watch the market closely to see significant fluctuations. And here the three indicators we are using will work to our advantage. All three will signal the trend reversal is coming.
Signals for placing a buy position
EMA crosses the green bullish candle that has formed on the chart and continues to move below the price. MACD consists of two lines. The green one is supposed to cross the red line and move over it. And Parabolic SAR must stop moving above the price and start to run below it instead.
Pros and Cons of Using MACD, EMA, and Parabolic SAR for Trading Long Intervals👍👎
Pros👍
- Helps predict trend reversals.
- Increases the probability of successful trades.
- Settings can be adjusted for individual trading strategies.
Cons👎
- Requires constant market observation.
- May not be suitable for short-interval trading.
- No indicator is 100% accurate; there is always risk involved.
| Indicator | Role in Trading |
|---|---|
| MACD | Helps identify potential buy and sell signals. |
| EMA | Tracks price changes over a specified period, smoothing market fluctuations. |
| Parabolic SAR | Provides entry and exit points, indicating when the price trend is likely to change. |
Signals for placing a sell position
If you think about entering a lower position the indicators should be as follows: EMA cuts the bearish candle and begins to move above the price. The green line of MACD crosses the red one and moves below it. And Parabolic SAR stops, then breaks, and moves over the price.
The combination of MACD, EMA, and Parabolic SAR provides a great help in identifying the trend reversal. Use them if you want to place long-lasting trades. The probability of winning will be bigger if you use the 5-minute period candles chart for opening trades of duration 30 minutes or more.
Now head to your Olymp Trade demo account and see how these indicators work together for your success.
Have a good trading experience!
Commonly Asked Questions🙋♀️
- Q: How do I set up MACD, EMA, and Parabolic SAR on the Olymp Trade platform?A: After logging in, select the Japanese candlesticks chart with a 5-minute interval. Then, click the indicator icon and search for the indicator you want to set up. Repeat this for each indicator.
- Q: How do I adjust the settings of each indicator?A: You can adjust the settings of each indicator to meet your trading requirements. For the strategy outlined in this guide, set your parameters to: EMA 10, MACD 12, 26, 9.
- Q: What signals should I look for to place a buy position?A: Look for the EMA to cross a green bullish candle and continue to move below the price. The green line of the MACD should cross the red line and move above it. The Parabolic SAR should stop moving above the price and start to run below it.
- Q: What signals should I look for to place a sell position?A: The EMA should cut through a bearish candle and begin to move above the price. The green line of the MACD should cross the red line and move below it. The Parabolic SAR should stop, then break, and start to move above the price.
- Q: Can I use this strategy for short-interval trading?A: This combination of indicators is specifically designed for long-interval trading and may not be as effective for short-interval trading.