Trading With the MACD Indicator Is Very Profitable || The Most Effective Strategy Is Easy To Use And 100% Successful





Trading with the MACD Indicator is very profitable

MACD indicator or called (Moving Average Convergence / Divergence) is very popular and is widely used by traders in the forex market. This technical indicator is very easy to use for trading and in a short time to be welcomed by various groups because it is considered simple and flexible.

The MACD indicator shows the direction of the trend and market momentum. In general, MACD is used as.

> measuring the strength of the trend that is happening

> gauge market momentum, whether the conditions are overbought or oversold

> this indicator whether there is a bullish or bearish divergence. This function is quite popular because the results can be accurate and if the signal occurs simultaneously with overbought or oversold market momentum.



Several versions of MACD display in a trading platform basically represent the same parameters. The standard version of the Metatrader platform usually uses areas to declare MACD, but the line version is more popular because it is very easy to observe. 

In Metatrader, we can install the MACD indicator by clicking Insert >> Indicators >> Oscillators >> MACD. The MACD indicator will appear automatically. 
   

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Components of MACD 



MACD is the difference between the Exponential Moving Average or EMA value, period 12 and EMA period 26. The value of this parameter is recommended and always used. This difference in value can be displayed in the form of lines or areas such as the display on the Metatrader platform. In addition to the MACD line or area as the main component, and to find out the right buy or sell momentum, a signal line or signal line in the form of a Simple Moving Average is used for a period of 9. This signal line is created to refine the MACD. 


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The MACD area will widen when the distance between EMA-12 and EMA-26 widens. And note also, when the EMA-12 and EMA-26 lines are the same or intersect, then the MACD value is exactly at the zero line.

 
> If EMA-12 is greater than EMA-26, then the MACD value is positive and the MACD area is above zero, this indicates that the uptrend is strong. 

> When the EMA-12 line is below the EMA-26 line, the MACD value is negative and the MACD area is below the zero line. This implies a downtrend. 

> Buy signal occurs when the MACD crosses the signal line from the bottom, which is when there is oversold momentum. 

> A signal to sell occurs when the MACD crosses the signal line from above, or when there is overbought momentum.

> Exit signal if MACD crosses the signal line in the opposite direction to the entry. If the entry buy at point 2, then the exit can be at point 3. Whereas if the entry sell at point 1, then the exit at point 2.

The MACD indicator can show trading opportunities that arise from divergent conditions or the price is moving in a different direction from the MACD indicator.   

 Histogram on MACD Indicator (OSMA) 

 
OSMA or called Oscillator’s Moving Average or prevalent, histogram is the difference between the MACD value and the signal line. On the Metatrader standard platform, indicators that are part of the MACD are called OSMA and are presented separately from the MACD indicator while on other trading platforms, the MACD and histogram are displayed together. There are several brokers using the Metatrader platform to make the display more accurate.  

OSMA is also used as a separate indicator from MACD. Even many traders consider the histogram indicator more important than the MACD itself, the histogram area is always positive when the MACD is above the signal line, and negative when the MACD is below the signal line. 

The wider the histogram area, the faster price movements, MACD distance and signal lines are wider, the trend will be stronger. The histogram area above the zero line indicates a bullish state, while the histogram below the zero line shows the bearish state at the peak level and the valley histogram also shows the overbought and oversold levels.

 

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Trading With the MACD Indicator Is Very Profitable || The Most Effective Strategy Is Easy To Use And 100% Successful Trading With the MACD Indicator Is Very Profitable || The Most Effective Strategy Is Easy To Use And 100% Successful Reviewed by Kampus Seo on March 27, 2020 Rating: 5

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