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MACD Trading Bot

Use this bot to automatically trade based on the MACD (Moving Average Convergence Divergence) indicator, a popular momentum oscillator ...

Updated over 2 weeks ago

Overview

The MACD Trading bot uses one of the most popular technical indicators that combines trend-following and momentum characteristics. It generates signals by comparing two momentum lines: the MACD line (the difference between two moving averages) and its signal line. The bot enters positions when the MACD line crosses above its signal line and exits based on either MACD crossovers or specified profit/loss targets.

Details

The MACD indicator consists of three components:

  1. MACD Line: Difference between fast and slow EMAs

  1. Signal Line: Moving average of the MACD line

  1. Histogram: Difference between MACD and Signal lines

Trading signals occur when:

  • Buy Signal: MACD line crosses above Signal line

  • Sell Signal: Either:

  • MACD line crosses below Signal line (indicator-based exit)

  • Price reaches profit target or stop loss (target-based exit)

How to Configure the Bot

General Settings

  • Exchange Platform: Select your preferred exchange

  • Trading Account: Choose the account for bot operations

  • Market: Select the trading pair (e.g. BTC/USDT)

  • Starting Capital: Amount of quote currency to allocate

  • Full amount is used for purchases

  • Profits are automatically reinvested

Strategy Settings

  • Candle Timeframe: Chart interval for analysis

  • Options: 1m, 5m, 15m, 1h, 4h, 1d

  • Lower timeframes = more frequent signals

  • Higher timeframes = stronger but fewer signals

  • MACD Fast Period: Shorter-term EMA period

  • Default: 8 periods

  • Range: 2-200 periods

  • More responsive to recent price changes

  • MACD Slow Period: Longer-term EMA period

  • Default: 16 periods

  • Range: 2-200 periods

  • Provides trend context

  • MACD Signal Period: Signal line smoothing

  • Default: 5 periods

  • Range: 0-200 periods

  • Smooths MACD line for signal generation

  • Exit Strategy: Choose between:

  • Profit Target or Stop Loss: Exit at specified profit/loss levels

  • Indicator Confirmation: Exit on MACD crossover signals

  • Cooldown Period: Candles to wait after closing a position

  • Helps avoid false signals

  • Set to 0 for continuous trading

Profit & Risk Management

(Only visible when using "Profit Target or Stop Loss" exit strategy)

  • Profit Target: Percentage gain to trigger position close

  • Default: 1%

  • Can set values above 100% for longer-term trades

  • Stop Loss: Percentage loss to trigger position close

  • Default: 0.5%

  • Set to 100% to effectively disable stop loss

Frequently Asked Questions

How do the MACD periods work together?

The relationship between periods affects signal generation:

  • Fast Period: Shorter period = more responsive to price changes

  • Slow Period: Longer period = better trend identification

  • Signal Period: Shorter = faster signals, longer = fewer false signals

Common combinations:

  • Aggressive: 5, 13, 3 (more signals)

  • Standard: 12, 26, 9 (balanced)

  • Conservative: 8, 16, 5 (fewer false signals)

Which exit strategy should I choose?

  • Indicator Confirmation:

  • Better for trending markets

  • Lets profits run during strong trends

  • More natural exits based on momentum shifts

  • May give back some profits on reversals

  • Profit Target or Stop Loss:

  • Better for ranging markets

  • Locks in profits at specific levels

  • Clear risk management

  • More predictable trading outcomes

How should I choose timeframes?

Consider your trading style:

  • Scalping:

  • Use 1m-5m timeframes

  • Tight profit targets (0.1-0.5%)

  • Very tight stop losses

  • Many trades per day

  • Day Trading:

  • Use 15m-1h timeframes

  • Moderate targets (0.5-2%)

  • Standard stop losses (0.5-1%)

  • Several trades per day

  • Swing Trading:

  • Use 4h-1d timeframes

  • Larger targets (2%+)

  • Wider stop losses

  • Fewer trades per week

What's the purpose of the Cooldown Period?

After closing a position, the bot waits for the specified number of candles before taking new trades. This helps:

  • Avoid whipsaw markets

  • Reduce false signals

  • Allow trends to establish

  • Minimize trading fees

How does capital management work?

The bot:

  • Uses entire available capital for initial purchase

  • Updates available capital after each trade

  • Automatically reinvests profits

  • Reserves 0.5% for trading fees

Remember that MACD is a momentum indicator that works best in trending markets. In sideways or highly volatile markets, consider:

  • Using longer timeframes

  • Implementing longer cooldown periods

  • Setting appropriate profit targets and stop losses

  • Combining with other indicators for confirmation

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