Topic: [GUIDE]Moving Average Convergence Divergence (MACD) (Read 529 times)

MACD is too late for traders. It is used to confirm what happened on the market days ago. On the market, price have different changes: rises, falls dramatically and small fluctuations. MACD is useless to shed you a light that price will have dramatical rise or fall in the future. Fortunately it gives you a signal of confirmation that the price now is a stable time with minor fluctations. Minor fluctuations mean price will move ups and downs in a price channel. You will have safe trades in that channel before the day a new price channel will be formed.

Thanks I will be adding this to my study menu.

I have been watching rsi a lot and the ma can be a bit of a mystery when people explained the setting for me to make it more meaningful (Kurious).

Have you made any other guides? or do you intend to?

Im always interested in good content let me know.

Good job.




What does this line say

As someone who uses the indicator you mentioned, I would like to say that in some cases, the MACD may generate a signal too late and cause us to miss opportunities or make a mistake.  Therefore, it will definitely not be the right thing to make a price review and trade using only MACD.  Thank you very much for the effort of the subject owner, definitely my purpose in making this comment is not to undermine the subject.  I just wanted to point out that the use of the MACD indicator alone is insufficient and in some cases produces late signals.

I think that was a good idea too, for now, I'm using only the MACD because it is suitable for all of my trades but I think soon there is a chance that I will make a guide too with the use of EMA and Bollinger bands, I highly suggest that you can explore more trading indicators which are good for your trades.

Good initiative OP its a good guide to the newbie because today there are a lot of people asking to the trading discussion thread because some of them already lose their trades because in some mistakes now, by the things you made about the example and how does the MACD work it gives a lot of hope and new knowledge to the traders.
Sometimes we are making trades we are using the different and a lot of trading indicators which is bad because some of them are just similar and showing the same result only I hope you will add some of the trading guides like how to use the EMA or the Bollinger bands because those are the things I want to learn too. Again nice thread keeps this up.

Good job OP! One of the best momentum indicators in trading.
MACD is a really simple momentum indicator that also has some similarities to some momentum indicators, but what I like on MACD is the histogram which is helpful for identifying the trend.
Well, even I don't always MACD, still I tried to learn this one and it is much advisable to use for momentum indicators in our chart.

From the previous weeks, I already share this thread into our local board and I want to share this to the people who want to use the MACD because this is the most trading indicators I always used and give me a lot of warning about the market movement, also it may help to the beginners that want to find what is the best suitable trading indicators to them. We have a lot of trading indicators but this is the easiest trading indicator to me.  

First, we need to add some of the definition to the MACD

MA - Moving Average
C - Convergence
D - Divergence

The parts of the MACD

MACD Line
One of the sensitive line

Signal Line
A line that has a slow pick up about the market movement.

Histogram
This histogram identifies if it has a changes on the market if it's going to uptrend or downtrend. On using the MACD you need to look at the zero line  Figure (1) to see if there is an activity about the market price.



Find the MACD on trading indicators (I'm using binance future trade)


The trading indicator will give us a default value of  MACD (12,26,9)


You can change the outline, color and the appearance if you want which is you are more comfortable.


Now we already know the parts and this time we are now going to identify if the market is going to uptrend or downtrend?

MACD Crossover
The MACD Crossover is the rendezvous of the MACD Line and Signal line as these two crosses each other in the event of a change in the market. As you can see in figure (2) the first circle comes from the uptrend and the MACD Crossover and the next in the market. So in the second circle where we can see from the downtrend the MACD Crossover and now uptrend.




MACD Divergence
There is a two since to the market changes or divergence on the figure (3) you can see a two peaks and after the second peak there is a chance that the market price of the coin will fall down this is common things happen to the market, next in figure (4) you can see two peaks which are near to each other and the first one is higher than the second there is a huge chance the market fill fall again because it's trying to achieve the previous resistance but it fails.



Now I would like to share the settings I used on trading with the help of MACD actually I'm using the default one and this setting of MACD(3,16,9) because it gives more information what is the next market movement.

As we can see on the Figure(5), it has the same time frame but the MACD(3,16,9) gives more information about the MACD Crossover will happen which is a good sign for making a good market profit.


I hope this will help the newbies especially.

You can visit this What is MACD(Moving Average Convergence Divergence)? How to use it? for additional knowledge on MACD too.

Ps. I'm not a professional trader I just want to share my knowledge.