MACD Divergence: Catch Divergences Automatically, Enter Only on a Confirmed Close
When the price makes a new low but the indicator keeps getting stronger, a turn is often on the way. The problem is you see it but don't pull the trigger — or you act too late. MACD Divergence watches for MACD divergence for you, enters only once the candle close confirms it, and sizes the stop and position by how volatile the market is.
This strategy supports Simulation: trades are filled against live prices, but no real orders are placed.
How it works
- 1
Spot consecutive divergences
Using MACD, it finds two troughs (or peaks) on the same side of the zero line: the price keeps making new lows while MACD makes higher lows. A bearish divergence is the reverse.
- 2
Enter only at the candle close
A trough only counts once a few candles on each side confirm it, so the signal lags by a few candles; once confirmed, it enters at the close. Bullish divergence goes long, bearish goes short.
- 3
Size the stop and position by volatility
The stop sits beyond ATR times a multiplier, and that distance is 1R. With "Risk percent", the position size is worked back from the amount you're willing to lose divided by 1R — a wider stop means a smaller size, a tighter stop a larger one.
- 4
Exit by reward:risk
A single take-profit sits at your set reward:risk. With scaled take-profit, part of the position is closed at the first target, and the stop on the rest can move to breakeven while it runs to a further target.
Who it's for
- People who trust divergence signals but often see them without acting
- People who want to keep each loss to a fixed share and trade by reward:risk
- People who don't want to sit and wait for the candle close to confirm
Key settings
- Evaluation timeframe
- The candle interval whose close is used to check for divergence (default 1 hour). Shorter intervals give more signals, and more noise.
- Trade direction
- Both directions, Long only (bullish divergence) or Short only (bearish divergence).
- Position sizing
- "Risk percent" works out the size from the stop distance automatically; you can also switch to "Fixed notional (USDT)".
- Risk per trade (% of capital)
- The most of the strategy's capital you're willing to lose on each trade (default 1%).
- Take-profit mode
- Single target (fixed reward:risk), or scaled (bank some, run the rest).
- Reward:risk (R)
- How many times the stop distance the take-profit sits at — 1.5 means it exits after gaining 1.5 times the stop distance.
Risks and things to know
A divergence doesn't guarantee a reversal. If the price keeps going the same way after it appears, the stop-loss will be triggered.
A trough needs a few later candles to confirm it, so the signal always lags by a few candles — you won't enter at the exact low or high.
Futures only. Leverage magnifies both gains and losses.