In this article, we outline a simple trend line trading strategy using the MACD oscillator. Latest Forex vs CFDs: Confirmation by two or more indicators presents a stronger case for making a trading decision than relying on just one.
Using the MACD in Trading
Supplier of iron oxide, bauxite for AL, titanium dioxide for paints, coatings, copper, diamonds, and uranium as large-cap mining stock. Not recommend Target 1: Set to touch greater than Seems heading towards 58 price again. Watch the black change to blue on 4h or 1d chart for entrance, which is currently black. Shorting gold for a little, just messing around with indicators to see if they are accurate enough to base my shortterm trades on them.
Stoch RSI heading down: Expanding my TA beyond cryptocurrencies. Looking at the moving average on the daily charts, you can see that the stock is starting to trend down. The weekly chart is also showing a movement down still and has hit a ceiling on the middle bollinger band. Good opportunity to watch and get in if the stock shows a Quick Update Guys, All the relevant information is as usual on the chart.
Too busy trading and charting today to write an essay, yesterdays chart contained some valuable knowledge but it seems people on here are only interested in Super biased Charts. It follows on from linked Article if you missed it, check it out it explains the buy Indicators and Overlays Centered Oscillators.
The indicator uses a MACD line, a signal line, and a histogram. A signal line is actually a moving average of the MACD line itself. Convergence occurs when the two lines move towards each other, and divergence occurs when they move away from each other. You will notice that the more divergence exists between the two lines, the higher the histogram is building. This means that when the divergence occurs we have momentum building.
The histogram shows you the speed of the move or momentum. Like we said before, you will notice that you have a histogram building up or down when the two lines are farthest from each other. When the two lines start to move towards each other, the histogram starts to build down towards the zero line. When the histogram starts to build above zero it, means that momentum is building to the up side.
In this case, for example, you see that the histogram starts to build to the up side at the same time that this big blue candle starts to appear on your chart. This means that momentum is building to the up side.
On this case, when this candle starts to appear to the down side, you can see that we have divergence from the two lines and we have momentum building to the down side, because the histogram is building below zero.
When the MACD line crosses the center line, we have shifted to an immediate bull market. In this case you can see that when the MACD line crosses below the zero line or the center line, we have switched to an immediate bull market. When it crosses back above it, we have switched to an immediate bull market.
This is the overall look of the MACD. First of all for a bull setup. We have to be clear on something. Unlike other oscillators, we are not looking for extreme readings.
This means that we are not looking for the MACD to be above a certain level or below a certain level because the MACD does not show you overbought and oversold readings. It shows you the momentum in price. We also need momentum to start building to the upside, meaning that once we have hit an area of support, we will be looking for a signal line to cross above the MACD line and the histogram to start building to the upside.
You can see that here we have come to a support level, and then we have a signal line crossing above the MACD line and we have momentum building to the upside.
Here we have a great opportunity to go long, and of course our stops should go always below the previous low. In this case, we have a winning trade and we can exit the trade when the signal line crosses below the MACD line and momentum starts building to the downside.
As you can see here, by doing this we have caught the best of the move up. In a burst setup at a resistant level we look for a signal line to cross below the MACD line. The histogram will start building to the downside to know the move has enough momentum to take price down.
Another Facebook chart, a 50 minute Facebook chart. You can see here that we have hit a big area of resistance and right here we have the signal line crossing below the MACD line and we have momentum building to the downside. We go short and here we can take out our position when this signal line crosses above the MACD line and momentum starts to fade and build to the upside.
As you can see, we have taken a nice dip on this one to the downside. Practice Trading at eToro Now!