A View on MACD in Forex Trading

Moving Average Convergence Divergence, this is known as MACD by the technical analysts in short. The team of Money Classic Research is well qualified and capable of implementing the MACD tool to find accurate tips. The Best nifty option tips provider majorly implement this technical tool to determine the moving averages of an underlying asset, which indicates a new trend. The new trend may be bullish or bearish.

The prime goal of all the traders and investors is to find a trend in stock market after all. When you spot a trend in market then you have good opportunity to make most money.

How to use MACD tool?

You can find three numbers in a MACD chart, which are used for its settings. Here is the description of all the three numbers used in chart.

·       The first number in the chart is number of periods, which are used to estimate the faster-moving average.

·       The second number of the chart is the number of periods, which is implemented in the slower moving average.

·       The third number of the chart is the total number of bars, which are used to estimate the moving average in between the faster and slower moving averages.

Now let us suppose that the MACD parameters are “12, 26, 9”. However, generally in the default setting for most charting software you could find these parameters. So the interpretation of these numbers would be done as following;

·        Number 12 shows the earlier 12 bars of the faster moving average in chart.

·       Number 26 shows the previous 26 bars of slower moving average in chart.

·       At last number 9 shows the earlier 9 bars of the difference between the fast and slow moving averages in chart. Number 9 will be plotted by vertical lines in the chart. These vertical lines are called histogram.

However, few technical analysts find difficulty in understanding the lines of the MACD. Always remember, the two lines that are drawn vertically are not moving averages of the price but they are the moving averages of the difference between the fast and the slow moving averages.

So in the above example the faster moving average is the moving average will be the difference between the 12 and 26-period moving averages.

You may find difficulty in understanding this technical tool; hence you can take help of veteran technical analysts. The technical analysts of Money Classic Research are well qualified and they have years of experience in generating accurate Forex tips by implementing MACD. The dedicated team of Money Classic Research also ensures to offer Currency futures prices on regular basis.