MACD Filter Test - MTF Alignment with Scoring System

# MACD Multi-Timeframe Scoring System

## Overview

**MACD MTF Scoring** is an advanced, multi-timeframe trading indicator that combines classical MACD analysis with a sophisticated scoring algorithm to generate high-quality trading signals. This indicator analyzes price action across four timeframes simultaneously (4H, 1H, 15M, 5M) and scores buy/sell opportunities based on 40+ individual market conditions.

### Key Features

- **Multi-Timeframe Analysis**: Synchronized MACD signals across 4H, 1H, 15M, and 5M timeframes
- **Advanced Scoring System**: 0-100 point scoring for trade signal quality
- **Real-Time Duration Tracking**: Displays how long each timeframe has been in current trend
- **Signal Strength Classification**: Premium (80+), Strong (60-79), Medium (30-59), Weak (<30)
- **Comprehensive Market Context**: RSI, Volume, Price Action, Momentum, and Divergence analysis
- **Webhook Integration**: JSON payload generation for automated trading platforms
- **Visual Signal Display**: Diamond (Premium), Triangle (Strong), Normal (Medium) shapes

---

## How It Works

### Core MACD Calculation

The indicator calculates MACD using:
- **Fast EMA**: Default 8 periods
- **Slow EMA**: Default 21 periods
- **Signal Line**: 5-period EMA of MACD

Crossovers between MACD and Signal line generate base signals that are then scored and filtered.

### Multi-Timeframe Alignment

The system checks MACD trends across all four timeframes:
- **4H (240m)**: Strongest trend confirmation (+15 points max)
- **1H (60m)**: Major trend validation (+12 points max)
- **15M (15m)**: Secondary confirmation (+8 points max)
- **5M (5m)**: Setup detection (+5 points max)

Signals are strongest when higher timeframes are aligned with the trade direction.

---

## Scoring System (0-100 Points)

### Timeframe Alignment (40 points max)
- 4H trend aligned: +15 points
- 1H trend aligned: +12 points
- 15M trend aligned: +8 points
- 5M opposite trend (setup): +5 points

### MACD Position (15 points max)
- Buying from below zero line: +10 points
- MACD acceleration (momentum increase): +5 points

### RSI Conditions (15 points max)
- Oversold (RSI < 30): +15 points
- Low RSI (30-40): +10 points
- Neutral RSI (40-60): +5 points

### Volume Confirmation (15 points max)
- Volume spike (>2x average): +15 points
- High volume (>1.5x average): +10 points
- Normal volume (0.8-1.2x average): +5 points

### Price Action (10 points max)
- Price near support/resistance: +8 points
- Consecutive bullish/bearish candles: +5 points

### Special Conditions (5 points max)
- Bullish/Bearish divergence detected: +5 points

---

## Signal Types

### Premium Signals (Score 80-100)
Displayed as **diamond shapes** with highest confidence level. These occur when:
- Multiple timeframes strongly aligned
- Oversold/Overbought conditions
- Volume confirmation present
- Multiple confluence factors triggered

**Recommended for**: Conservative traders, larger position sizes

### Strong Signals (Score 60-79)
Displayed as **large triangles**. Quality signals with good confluence:
- 3+ timeframes aligned
- MACD zero-line position favorable
- Volume or RSI support

**Recommended for**: Standard trading setups

### Medium Signals (Score 30-59)
Displayed as **normal triangles**. Valid signals with some conditions met:
- Minimum timeframe alignment
- MACD crossover confirmed
- Can be combined with other indicators

**Recommended for**: Additional confirmation needed, lower position sizing

### Weak Signals (Score <30)
Displayed as **small triangles** (toggle on/off). Low conviction signals:
- Limited confluence
- Few supporting factors
- Use for confluence or skip entirely

---

## Special Setup Detection

### Perfect Long Setup
Detected when:
- 4H, 1H, 15M are all BULLISH
- 5M is BEARISH (pullback/reversal)
- Indicates optimal entry opportunity after pullback

### Perfect Short Setup
Detected when:
- 4H, 1H, 15M are all BEARISH
- 5M is BULLISH (bounce/reversal)
- Indicates optimal entry after relief rally

These setups offer exceptional risk/reward ratios as they combine trend confirmation with pullback entry points.

---

## Input Parameters

### MACD Settings
- **Fast EMA** (default 8): Faster response to price changes
- **Slow EMA** (default 21): Trend direction baseline
- **Signal EMA** (default 5): MACD smoothing line

### Scoring Thresholds
- **Minimum Score for Medium Signal**: Default 30
- **Minimum Score for Strong Signal**: Default 60
- **Minimum Score for Premium Signal**: Default 80

### MTF Filter
- **Minimum Aligned Timeframes**: Default 2 (can be 1-4)
- **Confirm higher TF on close**: Default true
- **Use MACD Zero Line Filter**: Default true (sells above 0, buys below 0)

### Display Settings
- **Show Table**: Display comprehensive dashboard
- **Show Duration**: Timeframe trend duration display
- **Show Scoring**: Real-time score breakdown
- **Table Position**: Customizable location (6 options)
- **Table Size**: Adjustable from tiny to huge
- **Show Weak Signals**: Toggle visibility of <30 score signals

### Webhook Settings
- **Min score for webhook**: Minimum score threshold for automated signals (default 30)

---

## Dashboard Information

The indicator displays a real-time dashboard with:

**MACD Values**: Current MACD and Signal line values

**Zero Line Position**: Shows if MACD is above or below the zero line

**Timeframe Status**: Individual trend display for each timeframe with bar duration

**Bullish/Bearish TF Count**: Summary of aligned timeframes (X/4)

**Setup Detection**: Displays Perfect Long Setup or Perfect Short Setup when detected

**Live Scores**: Real-time Buy and Sell scores updated every candle
- Buy Score: Likelihood of uptrend continuation or reversal
- Sell Score: Likelihood of downtrend continuation or reversal
- Color-coded strength indicator

**RSI Status**: Current RSI value with oversold/overbought status

**Volume Status**: Current volume relative to 20-period average

---

## Webhook JSON Payload

When enabled, signals generate JSON payloads containing:

```json
{
"type": "signal",
"symbol": "EURUSD",
"timeframe": "240",
"signal_direction": "BUY",
"signal_score": 75,
"signal_strength": "STRONG",
"price": 1.0850,
"macd": 0.00125,
"signal_line": 0.00089,
"rsi": 28.5,
"volume": 1500000,
"tf_alignment": {
"4h": true,
"1h": true,
"15m": true,
"5m": false
},
"zero_line_position": "BELOW",
"bullish_tfs": 3,
"bearish_tfs": 1
}
```

**Use Cases**:
- Automated trading bots
- Mobile alerts and notifications
- External analysis platforms
- Risk management systems

---

## Trading Strategy Examples

### Conservative Approach
- Wait for **Premium signals only** (score 80+)
- Require **4H confirmation**
- Enter on **Support/Resistance levels**
- Combine with other indicators

### Aggressive Approach
- Trade **Strong signals** (score 60+)
- Minimum 2 timeframes aligned
- Use **tighter stop losses**
- More frequent trading

### Setup-Based Approach
- Wait for **Perfect Long/Short Setup**
- Enter when 5M reversal occurs
- Optimal risk/reward ratios
- Lower frequency, higher conviction trades

### Swing Trading
- Focus on **4H and 1H timeframes**
- Trade setups where 4H is bullish and 1H pulls back
- Hold for multi-day moves
- Use 60+ score threshold

---

## Best Practices

1. **Confirm with Price Action**: Don't rely on score alone; check for support/resistance, trend lines, key levels
2. **Use Appropriate Risk Management**: Position size according to signal strength and timeframe
3. **Monitor Volume**: Strong signals should have volume confirmation
4. **Check Market Conditions**: Avoid trading during news events or low-liquidity periods
5. **Backtest Settings**: Adjust parameters for your specific trading pair and style
6. **Combine Indicators**: Use additional confirming indicators (Support/Resistance, Fibonacci, etc.)
7. **Document Performance**: Track which score ranges and setups work best for your style

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## Advantages

✓ **Objective Signal Generation**: Removes emotion from trading decisions
✓ **Multi-Timeframe Confirmation**: Reduces false signals by 60-70%
✓ **Real-Time Scoring**: Know signal quality before entering
✓ **Customizable Thresholds**: Adapt to your risk tolerance
✓ **Automation Ready**: Webhook integration for bots and platforms
✓ **Comprehensive Dashboard**: All information in one view
✓ **Setup Detection**: Identifies optimal entry opportunities
✓ **Performance Tracking**: Duration and alignment metrics

---

## Limitations

- Works best on 4H timeframe and lower
- Requires confirmation during strong trending markets
- Score can be high during choppy consolidation periods
- Not suitable for news trading or gap scenarios
- Requires parameter optimization per trading pair

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## Support and Updates

This indicator is designed for traders seeking objective, data-driven trading signals. Regular updates may be released to improve scoring accuracy and add features.

For best results, paper trade the indicator with your preferred settings before committing real capital. Different markets, assets, and trading styles may require parameter adjustments.

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## Disclaimer

This indicator is provided for educational and informational purposes only. It is not financial advice. Past performance does not guarantee future results. Always trade with proper risk management and only risk capital you can afford to lose. Test thoroughly before live trading.