In the existing technical analysis software, the common parameter of MACD is 12 for fast smooth moving average and 26 for slow smooth moving average.
In addition, MACD has a secondary indicator, the BAR.
In most futures technical analysis software, the bar line is colored.
The color below axis 0 is green, and the color above axis 0 is red.
The former represents a weak trend, while the latter represents a strong trend.
Let’s talk about the basic principles to follow when using the MACD indicator: 1. When DIF and DEA are above the 0 axis, it is a long market.
When the DIF line crosses the DEA line from bottom to top, it is a buy signal.
When the DIF line crosses the DEA line from top to bottom, if the two line values are still running above the axis 0, it can only be regarded as a short-term drop, and the trend turning cannot be determined.
At this time, whether to sell needs to use other indicators for comprehensive judgment.
2. When DIF and DEA are below the 0 axis, it belongs to the short market.
When the DIF line crosses the DEA line from top to bottom, it is a sell signal.
When the DIF line crosses the DEA line from bottom to top, if the values of both lines are still below the 0 axis, they can only be regarded as a short-term rebound and a trend turn cannot be determined.
At this time, whether to buy with the help of other indicators for comprehensive judgment.
3. Column line contraction and amplification.
In general, the continuous contraction of the bar indicates that the strength of the trend is decreasing.
When the color of the bar changes, the trend determines the turn.
However, this view cannot be fully established when using some MACD indicators with short time periods.
4. Form and departure.
The MACD index also emphasizes pattern and divergence.
When the DIF line of MACD index and MACD form a high bearish pattern, such as head and shoulder top, double head, be vigilant;
Consider buying when the DIF line of the MACD index forms a low call form with the MACD line.
When judging the shape, DIF line is the main line and MACD line is the auxiliary line.
When prices continue to rise, MACD index out of the wave is lower than a wave of movement, this means that appears at the top of the deviation, indicating that a fall in prices may in the near future.
When prices continue to fall and the MACD moves out of one above the other, it indicates a bottom divergence, which indicates that prices will end the decline and soon recover.
5, cowhide market indicators will be distorted.
When prices move not from top to bottom or bottom to top, but in a horizontal direction, we call it a cowhide market.
At this time, the MACD indicator light will generate false signals, the intersection of DIF line and MACD line will be very frequent, and the retraction and playback of the bar line will occur frequently, and the color will often change from green to red or from red to green. At this time, the MACD index will be in a distorted state, and the use value will be reduced accordingly.
The curve shape of DIF is used for analysis, mainly using the principle of index divergence.
Specifically: If there is a trend where the DIF moves in a direction that diverges from the stock price, it is time to take concrete action.
However, according to the above principles, the accuracy is not satisfactory.
Through practice, exploration and summary, the comprehensive application of 5-day and 10-day average price lines, 5-day and 10-day average quantity lines and MACD will greatly improve the accuracy.
Markets shrugged off the Fed‘s doubling, the dollar fell from a three-week high and gold rallied more than $20.
Please pay attention to the specific operation, the market is changing rapidly, investment needs to be cautious, the operation strategy is for reference only.
