Dealers Trade MACD EA – How it Works ??

The Dealers Trade MACD Expert Advisor is an innovative script that employs trend reversal trading techniques based on the MACD indicator, along with advanced account protection mechanisms during trade reversals.

Buy & Sell conditions in Dealers Trade MACD EA

This Expert Advisor identifies MACD divergence, whereby a BUYING opportunity is created when the MACD is falling, but the price is rising. Since the price is rising, but the MACD is falling, eventually the MACD must rise, and the potential of a bullish breakout is increased due to the feedback loop.

Similarly, a SELLING opportunity is created when the MACD is rising, but the price is falling. Eventually, the MACD must fall, and the potential of a bearish breakout increases due to the feedback loop.

Working of Dealers Trade MACD EA

Dealers Trade MACD EA evaluates conditions for a BULLISH or BEARISH divergence. When a divergence condition is detected, it places a trade in the direction of the divergence. For example, if MACD is rising, and the price falling, a BEARISH divergence is formed. The Dealers Trade MACD EA places a SELL trade at market price. The take-profit and stop-loss are set accordingly.

In the likelihood that the price continues to fall, no further action is necessitated because the SELL trade is profitable. The SELL trade is then managed using the trailing stop.

On the contrary, if the price continues to rise, the SELL trade is adversely affected, and at a loss. When this SELL trade reaches a loss of PIPS (pips), and the BEARISH divergence still exists, a new SELL trade is opened. This process continues till the SELL trades become profitable (some SELL trades may become profitable, while the earliest opened SELL trades may not become profitable), or new SELL trades will be opened at a distance of PIPS from the previous SELL trade, till the total number of SELL trades opened is equal to MAX_TRADES. The lot-size of the new trade is multiplied by DOBLE of the previous trade’s lot-size. When the maximum number of trades is reached, the robot does not open new trades – it waits for the stop-loss to hit, or for the trades to turn profitable.

If a BULLISH divergence is detected while SELL trades are open, the robot does not close the open SELL trades, but rather opens BUY trades with similar rules – each BUY trade is opened PIPS distance below the previous BUY trade.

The BUY and SELL trades are tracked independently, and their profits are not combined. If ACCOUNT_PROTECTION is enabled, then when the open profit of each leg (SELL or BUY)reaches SECURE_PROFIT amount, then the stop-loss of all the trades in that leg are moved to the average price (break-even) of that leg.

Configurable Inputs Dealers Trade MACD EA

  1. TAKE_PROFIT – The take-profit of each trade in pips.
  2. LOTS– The lot-size of each trade opened by this Expert Advisor.
  3. INITIAL_STOP– The initial stop-loss of each trade in pips.
  4. TRAILING_STOP – The trailing stop of each trade in pips.
  5. MAX_TRADES – The maximum number of open trades allowed by the Expert Advisor at any given time in each direction. For example, if this value is 5, then the Expert Advisor can open up to 5 BUY trades, and up to 5 SELL trades independently.
  6. PIPS –The minimum distance in pips between orders of the same type. For example, if this value 30, then the next BUY order should be at least 30 pips below the previous BUY order.
  7. SECURE_PROFIT – The amount in account currency, at which the account is secured if the open profit is above this level. For example, if SECURE_PROFIT is 50, then, all positions are moved to breakeven when the open profit is $50.
  8. ACCOUNT_PROTECTION – Specifies whether Account Protection is enabled. If Account Protection is enabled, then when the account profit is above SECURE_PROFIT the profitable positions are protected.
  9. ORDERS_TO_PROTECT – The number of orders to protect when ACCOUNT_PROTECTION is enabled.
  10. REVERSE_CONDITION – Specifies whether to trade normally, or in reverse mode. If this parameter is set to TRUE, then original BUY signals generated by the Expert Advisor are automatically converted to SELL trades, and vice-versa.
  11. MACD_FAST_EMA_PERIOD –The period used to calculate the fast MACD.
  12. MACD_SLOW_EMA_PERIOD – The period used to calculate the slow MACD.
  13. MM – Specifies whether Money Management is used. If this value is 1, then Money Management is enabled, otherwise Money Management is disabled. When Money Management is enabled, the lot-size is calculated based upon INITIAL_STOPLOSS and RISK.
  14. SLIPPAGE –The maximum allowed slippage per trade in pips.
  15. RISK – The risk per trade in percentage per trade if Money Management (MM) is enabled. The lot-size is calculated based on Account Balance, RISK and INITIAL_STOPLOSS.
  16. MAX_LOTS – The maximum allowed lot-size of each trade if Money Management (MM) is enabled.
  17. ACCOUNT_IS_NORMAL – Specifies whether the account is a normal account, or a micro-lot account.
  18. DOBLE –The lot-size multiplier applied to subsequent lots.