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MACD and RSI Trend Signals with Percentage Stop Losses

Article Strategy library · Author: ianzeng123
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Summary

This strategy combines MACD crossovers with RSI thresholds to generate long and short signals. A bullish MACD crossover can open a long when RSI is at or below 40; a bearish crossover can open a short when RSI is at or above 59. The described setup uses a 14-period RSI and MACD settings of 12, 26, and 9. It also describes a 3% percentage stop based on the recorded entry price, a time filter, and position sizing as a percentage of equity.

The document outlines the rules and lists a brief one-minute Binance BNB/USDT backtest window from February 13 to 19, 2025, but reports no performance statistics or results. It warns that ranging markets may cause frequent trades and costs, while a fixed percentage stop may exit too early in volatile conditions. MACD lag and the need to tune RSI thresholds are additional limitations; slippage and trading fees can affect realized outcomes.

Key ideas

  • A MACD crossover generates a trade only when RSI also meets the specified threshold.
  • The stated defaults use RSI length 14, MACD settings 12, 26, and 9, and a 3% stop.
  • The setup includes time filtering and percentage-of-equity position sizing.
  • The document gives a short backtest configuration but no performance results.
  • Ranging markets, indicator lag, fixed stops, fees, and slippage may weaken outcomes.

Tags

Technical indicatorsTrend followingRisk managementBacktestingCrypto

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.