| Updated: May 9, 2025For this strategy we will utilize only one technical indicator, the Moving Average Convergence Divergence (MACD). For a detailed overview of the MACD, you can read the article in our Forex Academy.
The time frame is set to 1 minute, while the expiry time is 2 minutes. For our purpose we need to modify the settings of the MACD. The default configuration is short-term (12), long-term (26) and MACD periods (9). We change it as follows: short-term (9), long-term (20) and MACD periods (3). In addition, the MACD main line is set as red, while the MACD signal line is set as white.
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- Regulation: NFA
- Leverage: Day Margin
- Min Deposit: $100
In order to make trading decisions, one needs to take into account the following conditions:
If he/she is to buy a Call option:
1. The MACD main line (red) needs to cross the MACD signal line (white) in a bottom-up manner and
2. There is a candlestick/bar above the cross spot, which correlates with the direction of the MACD main line. In this case – a bull-trend bar.
If he/she is to buy a Put option:
1. The MACD main line (red) needs to cross the MACD signal line (white) in a top-down manner and
2. There is a candlestick/bar above the cross spot, which correlates with the direction of the MACD main line. In this case – a bear-trend bar.
You should make sure that both conditions are present before you make your entry.
On the 1-minute chart of NZD/USD above the small triangles indicate where a call and a put entry (2 calls, 2 puts) should be made.