The 21-year-old is a free agent after being released by Premiership side Middlesbrough, and spent part of this season on loan at Brunton Park.
He scored seven times in 11 appearances for the Cumbrians, but speculation suggests both Hartlepool and the Iron are in the running for his signature.
But McDonald told the News and Star: "We are still in good dialogue with his representatives and we are getting closer every time we speak."