---
title: 'Most Effective MACD Strategy for Day Trading Crypto, Forex & Stocks'
source: 'https://youtube.com/watch?v=Yj0yEBxwLVw'
video_id: 'Yj0yEBxwLVw'
date: 2026-08-05
duration_sec: 589
---

# Most Effective MACD Strategy for Day Trading Crypto, Forex & Stocks

> Source: [Most Effective MACD Strategy for Day Trading Crypto, Forex & Stocks](https://youtube.com/watch?v=Yj0yEBxwLVw)

## Summary

This video explains the Moving Average Convergence Divergence (MACD) indicator and presents two trading strategies: a beginner-friendly approach combining MACD with a 100 EMA, and an advanced method that integrates MACD with price action and lower time frame confirmations. The presenter demonstrates how to apply these strategies to crypto, forex, and stock markets.

### Key Points

- **Introduction to MACD** [00:02] — MACD is a trend-following indicator showing the relationship between two moving averages. It has four components: MACD line, signal line, histogram, and zero line.
- **Components of MACD** [00:41] — The MACD line is faster and more sensitive to price changes; the signal line is slower. The histogram represents the difference between the two lines, turning green when MACD crosses above signal and red when it crosses below. The zero line is the center.
- **Using Crossovers for Momentum** [01:47] — Traders identify momentum by looking at crossovers: MACD crossing above signal indicates upward momentum, crossing below indicates downward momentum. Histogram size indicates momentum strength.
- **MACD vs Moving Averages** [02:41] — MACD is based on moving averages (default 12 and 26). Compared to simple moving averages, MACD provides earlier entry signals because it uses the signal line crossover, not the zero line.
- **Common Mistake: Using MACD Alone** [03:38] — Using MACD alone can give false signals in a downtrend because it only shows short-term momentum. Traders should consider the long-term trend to avoid trading against it.
- **Beginner Strategy: MACD + 100 EMA** [04:17] — Combine MACD with a 100 EMA to align with the long-term trend. If price is above 100 EMA, trend is up; take only bullish MACD crossovers. Place stop loss at nearest swing low and profit target at 1.5x stop loss.
- **Advanced Strategy: MACD + Price Action** [06:10] — For advanced traders, combine MACD with price action. Identify key levels on a higher time frame, wait for price to approach the level, then zoom in two time frames below to confirm momentum with MACD crossover before entering.
- **Advanced Strategy Example** [08:28] — Demonstrates the advanced strategy on GBP pairs: identify support level, wait for price to return, zoom in two time frames below, wait for MACD bullish crossover, enter long, set stop loss at key level and profit target at 1.5x stop loss.

### Conclusion

The video provides two practical MACD strategies: a simple one for beginners using a 100 EMA filter, and an advanced one for experienced traders using price action and lower time frame confirmation. Both aim to improve win rates by aligning with the trend and avoiding false signals.

## Transcript

strategy that you can use with the macd indicator so without further ado let's get on with the video the moving average convergence divergence or also known as the macd
is one of the most simplest and popular indicator used by traders essentially it is a trend following indicator that shows the relationship between two moving averages so first let's apply it onto our chart
section type in macd and click the one on top now before we start we first need to know how does the macd work
so we can see here there are four components to the macd first we have these two lines the macd line and the signal line notice the difference between the two the macd line moves faster and is more
sensitive to price changes which will be the main focus of the macd compare that to the signal line which reacts slower to price changes appearance next we have the histogram which
represents the difference between the macd line and the signal line for example if the line crosses above the signal line the histogram will turn green and if it crosses below
the histogram will turn red the gap between the macd line and the signal also affects the size of the histogram as you can see if the two lines are further apart the histogram gets bigger
and if the two lines get closer the histogram becomes smaller and finally we have the zero line which simply represents the center of the macd now the way traders utilize this indicator to identify momentum
is by looking at the crossover between the macd line and the signal line the macd line and the signal line let me show you an example if the macd line crosses above the signal line it indicates that the market is on an
and if it crosses below it indicates that the market is only downwards momentum traders can also utilize the size of the histogram to determine the strength of the momentum itself
line while the histogram is getting it shows us that the upwards momentum is getting stronger smaller in size it indicates that the upwards momentum
it indicates that the upwards momentum is getting weaker macd is based on moving averages and so the question is why should you and not the moving average well let me give you a quick comparison
default settings 12 and 26 and over here we also have two which are set to the same values as the macd which are 12 and 26. notice the correlation between the two
indicators every time we have a crossover on the moving averages we also have a crossover on the macd but it's between the macd line and the zero but remember what we look for in the macd is not the zero line
but rather the crossover between the macd line and the signal line the macd gave a much earlier entry signal average that's why i prefer it as my momentum
that's why i prefer it as my momentum indicator strategies that you can use with the macd indicator so first a common mistake that traders make is that they're using the indicator
let me show you why it's a bad idea to use the macd alone so here we can see that the overall market is only downtrend upwards so notice how the signals are
bullish momentum but the market is only downtrend this is by itself because what the macd is showing us is
only the short term momentum and as traders we also need to take the long term trend into consideration because we never want to trade against a trend and so a simple but high win rate strategy that
i recommend for beginners is by combining the macd with a long term trend indicator like the 100 ema this way we can safely trade the macd while making sure that we're staying within the same direction
of the long-term trend so this is how you trade the strategy the long-term trend by looking at the 100 ema if the price is above the 100 ema it indicates that the long term trend is up
and if the price is below the 100 ema it indicates that the long term trend is down so once you've identified the trend the crossovers on the macd that shows the same signal as the long
so in this particular example we can see is up meaning we only take signals when the macd crosses over upwards and so here's where you want to take a long position now for your exit strategy
nearest swing low and set your profit target at 1.5 times your stop loss and as you can see this trade ended up being profitable so let's look at another example
in this chart we can see that the price is below the 100 ema indicating that the long term trend is down next we have a cross down on the macd and so this will be our entry signal to go
now for your stop loss place it above the nearest swing high and set your profit target at 1.5 times your stop loss and as you can see the price hits our profit target and so this counts as a
successful trade so that was a simple macd strategy for beginners that you can use now for advanced traders if you want to get more profits using the macd you cannot simply rely on beginner
because remember crossovers tend to work only on trending markets the indicator will give you many false so that is why if you want to increase the win rate i recommend using a more
advanced version of the strategy which is by combining the macd with price action so here's how the strategy works the first step is we need to choose a time frame
time frame now the next thing you need to do is identify a key level within this time frame so as you can see the price went up hit and reverses downwards and so we can
draw a resistance line up here the next step is you want to wait for the price to approach the same key level once again now once this happens we are expecting the price to reverse downwards
key level doesn't guarantee that a reversal will happen because key levels aren't magic prices can and that is why we need to use extra confirmation to make sure that there is
actual downwards momentum as price touches this area which is play now what most traders will do is that cross over downwards before taking a short position
by doing this notice that the downwards movement has already been made movement has already been made and you would have entered in late an earlier entry signal is by zooming in two time frames below
so i'm currently in the four hour chart so let's zoom in into the two hour chart need to do is wait for the macd to cross over downwards in this new smaller time frame and so this is where you want to take a
short position so now let's go back to the 4 hour chart and compare the two entry signals so now we're back at the 4 hour time if you would have used the crossover from the two hour time frame
you would have entered in the trade here but if you would have used the crossover from the four hour time frame you would have entered in here and even profitable the smaller time frame crossover still
so let's look at the strategy one more so here's the poundian on the two hour time frame and over to the left reverses upwards making this a key support level now as
prices went back to this level again we want to confirm that there's actual upwards momentum as price touches this area so again you price touches this area so again you want to zoom in two time frames below
and apply the macd indicator so now all we need to do is use the macd to confirm the bullish momentum by waiting for it to cross over upwards once this happens you take a long position now let's go
back to the two hour time frame and apply our exit strategy so for our you can place it at the key level and set your profit target at 1.5 times your stop loss and as you can see this trade
ended up being profitable so i just revealed to you high win rate use right now and all i ask for in return is for you to invest two seconds of your time into liking the video and subscribe to the
it literally takes only two clicks but it means so much to me videos as well so thank you guys for watching and i'll see you in the next watching and i'll see you in the next video