MACD

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MACD

MACD is an indicator of the dynamics and the trend following the information derived from moving averages, so it will work perfectly as an additional tool and the filter of the momentum.

Take a look at the components of the MACD indicator:

The MACD line is the heart of the indicator and shows the difference between the 12-period EMA and the 26-period EMA, which means that, in principle, the MACD line is a complete intersection of moving averages. As long as the MACD line is above level 0 and the price above EMA 12 and 26, the trend continues. Because the indicator is based on moving averages, it is ideally suited for analyzing price dynamics, finding trend-consistent entries, and staying in trends until the momentum expires.

MACD or RSI – which indicator to choose?

Traders always wonder whether they should use MACD or RSI? Although these two indicators are very similar, if you’re a newbie, it’s best to use MACD. MACD has two main advantages over RSI that can help new traders make better decisions. MACD lines provide more information and are easier to read by novice traders.

 

 

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