Little K will explain to you the MACD high winning rate strategy! When the price is in a downward trend, the fast line crosses the slow line upward, which is the so-called golden cross. This means that the trend is about to change from a downward trend to an upward trend, which is a long trading opportunity. When the price is in an upward trend, the fast line crosses the slow line downwards, which is a dead cross, which means that the trend will change from upward to downward, so this is a reasonable entry point for short selling. This is traditional MACD usage.
Today, the editor of this website will give you a detailed introduction of Xiao K’s interpretation of MACD’s high winning rate tactics. All currency friends in need should take a look!
1. Concept definition MACD (Moving Average Convergence Divergence) tells about the relationship between two moving averages. There is one express line and one slow line. Basically, the function of the MACD indicator is to judge and speculate on the change or continuation of the price trend.
2. How to enable MACD indicator? Open the indicator library, search for the MACD indicator, and select it. The MACD indicator will appear below.
3. The blue line and the orange line and the green line (DIF, fast line) are the difference between the short-period (12-period) EMA and the long-period (26-period) EMA, also It's called "Express Line". It reflects market changes over a shorter time span and is therefore more sensitive than the slow line. The orange line (DEA, slow line) is the 9-period EMA of DIF, also called the "slow line". It is a smooth line calculated by DIF, which reflects market changes over a longer time span, so it is smoother and lagging behind than the fast line. The MACD energy column shows the difference between DIF and DEA. Based on these three elements, we can determine market trends and momentum changes.
When the price is in a downward trend, then the fast line crosses the slow line upward, which is the so-called Golden cross. This means that the trend is about to change from a downward trend to an upward trend, which is a long trading opportunity. When the price is in an upward trend, the fast line crosses the slow line downwards, which is a dead cross, which means that the trend will change from upward to downward, so this is a reasonable entry point for short selling. This is traditional MACD usage.
1. MACD Top Divergence When the high point of the price is higher than the previous one, it means Top Top High. Logically speaking, MACD should also form a top-top high to correspond to the trend momentum of the price. However, at this time, the MACD has formed a top-top low, and the trend momentum of the price is showing signs of weakening. The second high point is higher than the first, that is, the top is high. When the price forms a top and a high, but MACD forms a top and a low, it is a top divergence. Seeing that the price forms a top and a high, but the MACD forms a top and a low, it is a top divergence. The price trend will most likely turn downward. We need to find the key price + MACD trend reversal divergence to confirm the trend.
2. MACD Bottom Divergence If the price low is lower than the previous one, it means the bottom is lower. However, MACD has formed a bottom and a high, which means that the buyer's momentum has begun to intervene, the price's downward momentum has gradually weakened, and there is a high probability that the trend will change from a downward trend to an upward trend. When the price forms a bottom low, MACD forms a bottom high, which is a bottom divergence. When a bottom divergence is formed, it means that the trend will most likely turn into an upward trend, which is a reasonable opportunity to buy and go long.
3. MACD trend reversal trading strategy Key price + MACD trend reversal divergence, as long as two vertices are found to form a line, the bottom macd will also find the corresponding two vertices. The first step is to determine the key support level. We can see that the price has tested this support level many times and has risen a lot, so this one is the key support level. When the price returns to this key support level again, we You can look for long trading signals. For example, if we find a mountain peak, it has gone through a round of ups and downs and returned to the support level. However, please note that there is not much to do yet. Because we need one more signal to confirm that this bottom divergence is valid, we can draw a downward trend line, and then we will see a descending wedge triangle, which is a bullish chart pattern. When the price breaks out of the descending wedge triangle, we can enter the market and go long. If these two points are met and the downward trend line is broken, you can consider going long. Or we can draw a line at the previous high of the downtrend. When the price breaks through the previous high, this represents a trend disruption. There is a high probability that the price will change from a downward trend to an upward trend. We can enter the market and go long after the price breaks through the previous high. Summary: Key price + MACD trend reversal divergence.
4. How to find the support level? The support level can be understood as multiple retracement points, forming a valley or a mountain peak, and there will be multiple retracements at the foot of the mountain. It can be a small range of prices or a point. The MACD divergence + key price we just talked about, the key price is whether this support level is broken.
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