Tag: MACD

Modified Indicator Forexorama – MACD For MT4

The Forexoma-MACD is a modified indicator designed for the Metatrader 4 platform which is based on the MACD technical indicator. It was designed to be easier to read for the trader, as standard MACD signals can be somewhat complex for the beginner trader. In addition, it is designed to detect trend changes earlier as we will see later. It is a color-coded indicator which changes its color as soon as the analyzed asset changes trend.

This allows traders to detect the market trend much earlier than they could with the conventional MACD on the MT4 platform. The Forexoma-MACD actually works as a histogram whose bars change their color according to the current trend. Using the conventional MACD indicator on some occasions can cause traders to open their positions in the market when most of the price momentum is diminishing. This causes the trader to lose valuable pips of profit that could be obtained if he opens his positions earlier.

Trading system with stochastic oscillator and CCI indicator

by rcanessa

In this article we will present a trading system with stochastic oscillator that can be used to trade in any market and in any time frame (although it is preferable that the system is not used in time frames less than 15 minutes), which is based on the MACD, CCI and stochastic oscillator technical indicators. It is a technical trading strategy that provides clear buy and sell signals, as well as exit and take profit signals.

Because it is a system based purely on technical analysis, we do not recommend the trader to operate with this system in the periods in which economic news or important market indicators are published, since the trading signals of technical systems like this tend to fail.

As always, it is recommended to test this methodology with a demo account before using it to trade with real money.

Trading Systems Based on Moving Averages and MACD

by rcanessa

This is a trading strategy that can provide gains of between 20-30 pips per trade so it can be quite profitable. This trading system is very simple to use and its signals are easy to follow. The main features of this strategy are the following:

This is a trading system that combine the use of two well known technical indicators: moving averages and MACD. Also, the trader can use the Momentum indicator to confirm the trend direction. Basically, this system attempts to profit from changes in the market trend. The MACD and the Momentum are necessary because the moving averages crosses are not too reliable signals.

Moving Average Convergence Divergence Indicator – MACD Definition

by rcanessa

The Moving Average Convergence Divergence (MACD) is a popular technical indicator used to identify changes in momentum, trend direction, and potential buy/sell signals for an asset. It was developed by Gerald Appel in the late 1970s and has since become a widely used tool by traders and investors.

The MACD is calculated by subtracting a longer-term exponential moving average (EMA) from a shorter-term EMA. The result is a signal line that oscillates around a zero line, which represents the point of equilibrium between buying and selling pressure. The most commonly used EMA periods for the MACD calculation are 12 and 26 days.

In addition to the MACD line, a signal line is typically plotted as a 9-day EMA of the MACD line. This signal line is used to identify potential buy/sell signals based on crossovers with the MACD line. When the MACD line crosses above the signal line, it is considered a bullish signal, suggesting that buying pressure is increasing. Conversely, when the MACD line crosses below the signal line, it is considered a bearish signal, suggesting that selling pressure is increasing.

The MACD can also be used to identify divergences between the indicator and the price chart, which can signal potential trend reversals. For example, if the price is making higher highs but the MACD is making lower highs, it may suggest that the bullish trend is losing momentum and a bearish reversal may be imminent.

Overall, the MACD is a versatile indicator that can be used in a variety of ways to help identify potential buy/sell signals, trend direction, and changes in momentum for an asset. As with any technical indicator, it is important to use the MACD in conjunction with other forms of analysis and risk management strategies to make informed trading decisions.

Skydive Trading System: A Lowry System Variation

by rcanessa

Introduction

The Skydive System is a trading system based in the strategy created by Scott Lowry (see the Lowry System), an American psychologist and trader that regularly speculate in the Futures market. Basically, this trading technique is based on the intersection of three exponential moving averages as shown in the image:

In the same way as happens with other similar trading strategies based on moving averages, in markets with low volatility and without a defined trend, the Skydive System often produce false signals. For that reason we can include a filter based in indicators like the MACD or the Williams %R.

This is a simple trading technique based in moving average crosses. It is based in the famous trading system developed by Scott Lowry, so is basically a trend follower strategy. For that reason is no recommended in markets that are moving in a range without a clear trend.