Thread: 1) Do you have a question on MACD?

This is my first homework post. Hopefully, this works and thanks in advance.

CORRECTION:

My limit should actually be at 92.676 for a 1:2 ratio, sorry its not noted on chart

Originally Posted by Charles2012

This is my first homework post. Hopefully, this works and thanks in advance.

CORRECTION:

My limit should actually be at 92.676 for a 1:2 ratio, sorry its not noted on chart

Charles,

Its great to see you posting on the forum ! I really like your CHF/JPY chart as it has a great daily uptrend. Looking at your chart, it looks like you are looking at MACD crossovers where the signal line moves below the zero line. Great setup !

I received an ALERT from MACD indicator in a 2 hour time frame of a SELL signal for AUS200.
Below is the email.

You have received this message because the following signal alert was received:
Signal: MACD(AUS200(H2),12,26,9)
Symbol: AUS200
Message: MACD Signals:SELL
Time: 07/14 16:00
Price: 4473

However, the price action INSTEAD of SELL, have become a BUY signal. So from 4473 it went up to 5504.

Am I missing something? What happened? Attached is the chart, H2 time frame. Please help I need to understand why the MACD SIGNAL have become INACCURATE.

Thanks.

Originally Posted by rrpituc

I received an ALERT from MACD indicator in a 2 hour time frame of a SELL signal for AUS200.
Below is the email.

You have received this message because the following signal alert was received:
Signal: MACD(AUS200(H2),12,26,9)
Symbol: AUS200
Message: MACD Signals:SELL
Time: 07/14 16:00
Price: 4473

However, the price action INSTEAD of SELL, have become a BUY signal. So from 4473 it went up to 5504.

Am I missing something? What happened? Attached is the chart, H2 time frame. Please help I need to understand why the MACD SIGNAL have become INACCURATE.

Thanks.

Great question,

MACD by nature is a momentum indicator, as it uses a series of moving averages to determine its signals. As price stagnates and in this instance, price does not make a lower low, MACD will not move lower as well . It is hard to say at this point if the signal itself is completely inaccurate however downward pressure has temporarily stalled.

Hi all,
I've followed your very interesting trading course and especially the videos about MACD.
You say that in a bullish trend you can only buy and in a bearish one you can only sell. That's absolutely right, but, knowing the direction of the trend, why don't just buy or sell until the trend changes instead of opening and closing positions?
Thanks and sorry for the stupid question

Hi. That is not a stupid question at all. The reason we would not do that is that shorter term trends in the opposite direction can and will occur. Markets do not move in straight lines. Therefore we should look for trade set ups in the direction of the overall trend to keep our risk low. Buying simply because there is an uptrend for example carries much more risk. Prices might move a few hundred pips against you before you realize that the trend has changed. That is always a possibility.

Thanks very much for the reply. That make sense. I guess I have to encounter this as a lesson so that next time whenever there is a signal alert, I should verify first using other indicators to validate the signal.

Originally Posted by rrpituc

Thanks very much for the reply. That make sense. I guess I have to encounter this as a lesson so that next time whenever there is a signal alert, I should verify first using other indicators to validate the signal.

It is our pleasure.

Hi there,

I'm new to the forums and DailyFX.
I have watched the video's on MACD, and I am a bit confused.

Every time frame seems to give different signals, instead of confirming a move.

Eg: Daily says buy and 4h may say sell

How can I filter out these, and determine which is correct?

Hello, here is my first attempt at MACD.

USDJPY sell now as the MACD has just broken through the signal on a downtrend. 75.739. Stop loss at 76.329 and 1:2 Profit therefore at 74.559.

???

Originally Posted by jb021

Hello, here is my first attempt at MACD.

USDJPY sell now as the MACD has just broken through the signal on a downtrend. 75.739. Stop loss at 76.329 and 1:2 Profit therefore at 74.559.

???

Nicely done JB!

Jeremy,

I'm fairly new to Forex trading and I am taking a liking to the MACD indicators and strategy that is offered in the TSII platform.

Curious... what would be good parameters to set when creating the MACD strategy that is best suited for scalping?

Thank you!

Originally Posted by jaynlola

Jeremy,

I'm fairly new to Forex trading and I am taking a liking to the MACD indicators and strategy that is offered in the TSII platform.

Curious... what would be good parameters to set when creating the MACD strategy that is best suited for scalping?

Thank you!

Personally, I keep with the defaulted 12, 26,9 settings for MACD. How is your trading going ?

Dear Instructors,

Thank you for producing these informative and clear video tutorials, truly appreciate the efforts you have made.

I have a question on the use of multiple timeframes and MACD. I am a longer term trader which uses W1, D1 charts for trend identification and use H4 or H1 charts with MACD crossover for entry signal identification.

I seem to get the idea on the entry. However, I am having problems to identify the exit signals. I am a bit confused on what method should I use, what timeframe should I use for exit and how to determine my target. I know the target may be determined by Risk/Reward, and Support/Resistance, but how do I know whether I am setting a realistic one? Is there any guidance you can provide?

Thanks in advance.

Originally Posted by dmancyu

Dear Instructors,

Thank you for producing these informative and clear video tutorials, truly appreciate the efforts you have made.

I have a question on the use of multiple timeframes and MACD. I am a longer term trader which uses W1, D1 charts for trend identification and use H4 or H1 charts with MACD crossover for entry signal identification.

I seem to get the idea on the entry. However, I am having problems to identify the exit signals. I am a bit confused on what method should I use, what timeframe should I use for exit and how to determine my target. I know the target may be determined by Risk/Reward, and Support/Resistance, but how do I know whether I am setting a realistic one? Is there any guidance you can provide?

Thanks in advance.

Welcome to the forums ! It sounds like you have already begun researching risk management. Personally, I would start with a 1-2 Risk management setting. This affords us to be incorrect 2 out of 3 trades and still be break even on our account. If we can find ratios higher than 1-2 , even better !

You are also correct about time frames and strategies. Each chart we view will have differences we can take advantage of. Generally speaking, trading on longer term charts allows us to have larger profit targets. Support and resistance can be great points for exits and there are a variety of ways to find them . Personally, I would recommend checking out our "risk management" and " support and resistance" on demand videos for more details.

As always, if you would like to post charts you are viewing, we would be happy to assist you in further detail.

Video Course