How does MACD work?

MACD is a technical indicator that uses the aggregation and separation between the short-term (usually 12-day) exponential moving flat and the long-term (commonly 26-day) exponential moving flat of ** price to make judgments on buying and selling timing.

1.MACD Golden Cross: Diff breaks through DEA from bottom to top, which is the ** signal.

2.MACD Death Cross: Diff breaks through DEA from top to bottom, which is a sell signal.

3.MACD green to red: The MACD value changes from negative to positive, and the market changes from short to long.

4.MACD Red to Green: The MACD value changes from positive to negative, and the market turns from long to short.

5.Diff and DEA are both positive, that is, when they are above the zero axis, the general trend is a bullish market, and the DIFF breaks through DEA upwards as a signal.

6.Diff and dea are both negative, that is, when they are below the zero axis, the general trend is a bearish market, and the diff breaks dea to **, which can be used as a sell signal.

7.When the DEA line diverges from the K-line trend, it is a reversal signal.

8.DEA has a higher error rate when consolidating the situation, but if it is combined with RSI and KDJ indicators, it can make up for the shortcomings.

To put it simply.

Calculate the deviation between the long and short periods** (white line).

Calculate the deviation from the self-mean (yellow line) (bar line).

Must know the MACD essentials:

1. The main feature of the MACD indicator is its high robustness, which can give relatively stable buying and selling signals in a long period of time. Therefore, medium- and long-term operators can refer to the MACD indicator for specific operations.

2. The biggest disadvantage of the MACD indicator is that the signal of the indicator is too slow. Antenna-level MACD indicator slag is not suitable for ** operation.

3. In the medium and long term, it is effective for investors to use the MACD indicator. However, in the ** of large stock price vibrations and long and short anxiety, the MACD indicator does not have much reference value for investors.

The four roles of MACD:

1. Help judge the bottom.

When the stock price diverges from the MACD area (or DIF value), it usually indicates the appearance of a bottom, and it is necessary to pay attention to the opportunity to buy copy.

Second, help judge the top.

When the stock price diverges from the MACD area (or DIF value), it usually indicates the appearance of a top, and the sale of the top needs to be considered.

3. Help judge the end of **.

After the stock price enters multiple regions, the recall occurs, and after the recall ends, the stock price lasts or accelerates. The disk indicator formula provided with this book can immediately display the end of recall sail fluid signal.

Fourth, help judge the end of **.

After the stock price enters the bearish area, there will be **, and after the ** ends, the stock price will usually continue ** or accelerate**. The formula for the disk indicator combined in this book can also immediately show the signal of the end of the rebounding ball.

The MACD indicator reflects the interaction between time, time and space. Investors who want to use the MACD indicator to make a profit in the ** market, first of all, must clarify the four latitudes of the MACD indicator, namely position, direction, crossover and inflection point.

The MACD indicator is a trend-like indicator based on the construction principle of ****, which smooths the **** price (calculates the arithmetic mean). It is mainly composed of two parts, namely positive and negative difference (DIF) and mean of similarities and differences (DEA), where the positive and negative difference is the core and DEA is the auxiliary. DIF is the difference between the Fast Smooth Moving Flat (EMA1) and the Slow Smooth Moving Flat (EMA2).

In the existing technical analysis software, the common parameters of MACD are 12 for fast smooth movement and 26 for slow smooth movement. In addition, the MACD has an auxiliary indicator – the bar (bar). In most technical analysis software, the bars are colored, green below the 0 axis and red above the 0 axis, with the former representing a weaker trend and the latter representing a stronger trend.

Principles of application:1MACD Golden Cross: DIF breaks through DEM from bottom to top, which is the ** signal.

2.MACD Death Cross: DIF breaks through DEM from top to bottom, which is a sell signal.

3.MACD green to red: The MACD value changes from negative to positive, and the market changes from short to long.

4.MACD Red to Green: The MACD value changes from positive to negative, and the market turns from long to short.

Tips and tricks:1Diff and DEA are both positive, that is, when they are above the zero axis, the general trend is a bullish market, and the DIFF breaks through DEA upwards and can be bought.

2.Diff and DEA are both negative, that is, when they are below the zero axis, the general trend is a short market, and the DIFF breaks DEA to **, which can be sold.

3.When the DEA line diverges from the ** trend, it is a reversal signal.

4.DEA has a high error rate in the handicap, but if it is combined with RSI and KD, it can make up for the shortcomings appropriately.

5.Analyzing the MACD histogram, when it changes from positive to negative, it often indicates that it is selling, and vice versa.

Specifically, you can refer to the relevant aspects of the book system to understand, and then combined with a simulation disk to practice, so that the theory and practice can quickly and effectively master the skills, the current **treasure simulation version is not bad, many of the functions in it are enough to analyze**and**,It is helpful to use。 I hope it can help you, and I wish you a happy investment!

At the request of fans, today's MACD will be released, mainly talking about the logical principles of MACD, and the follow-up will dissect MACD in more detail, and continue to pay attention to **.

The MACD indicator is based on the construction principle of **, smoothing the ** price of ****, and calculating the arithmetic mean value after calculating, which is a trend indicator.

The MACD indicator is a double smoothing operation using fast (short-term) and slow (long-term) moving flats** and their signs of convergence and separation. According to the principle of moving flat development of MACD, one removes the defect of moving flat ** frequently sends false signals, and the other retains the effect of moving flat**, therefore, the MACD indicator has the characteristics of **trend, stability, stability, etc., and is used to judge the timing of buying and selling, and ****** technical analysis indicators of ups and downs.

The MACD indicator is mainly based on the research and judgment of the relationship between the three values of EMA, DIF and DEA (or MACD and DEM), the judgment of the moving level of DIF and DEA, and the judgment of the bar chart drawn by subtracting the DEM value from DIF, etc., and the main technical analysis indicator of the short-term trend of stock prices. Among them, DIF is the core and DEA is the auxiliary. DIF is the difference between the Fast Smooth Moving Flat (EMA1) and the Slow Smooth Moving Flat (EMA2).

The bar histogram is judged by the contraction of the red and green columns in the technical software.

For more information, please refer to the references.

MACD is developed according to the advantages of the moving level ** is easier to grasp the direction of trend changes, it is the profit section potato trace with two different speeds (one change rate fast - short-term moving flat**, the other slower - long-term moving flat**) exponential smoothing move ** to calculate the difference between the two (DIF) as the basis for judging **, and then find its DIF 9-day smooth moving flat**, that is, MACD line. MACD is actually the use of fast and slow moving flat convergence and separation of signs, to determine the timing and signal of buying and selling.

1) Basic usage of MACD:

In the application of MACD, the 12-day fast moving level** (12-day EMA), and the 26-day slow moving level** (26-day EMA), first calculate the two moving level** values, and then calculate the difference between the two values, that is, the difference value (DIF) = 12-day EMA-26-day EMA. Then, according to this deviation value, the 9-day EMA value (i.e., MACD value) is calculated. Draw the DIF and MACD values respectively, and then analyze them according to the "staggered analysis method", when the DIF line breaks through the MACD smoothing line upward, it is the point of confirmation of the rally, that is, the ** signal. On the contrary, when the DIF line breaks through the MACD smoothed line towards **, it is the point where the downtrend is confirmed, that is, the sell signal.

2) Application Rules:

DIF and MACD are above 0, and the general trend is a long market.

When DIF breaks through the MACD upwards, it can be purchased; If DIF breaks the MACD to **, it can only be closed as the original order, and no new sell order can be entered.

DIF and MACD are below 0, and the general trend is bearish.

When the DIF breaks the MACD to **, it can be held and sold; If DIF breaks through the MACD upwards, it can only be used to close the original order, and no new buy order can be entered.

The high-grade secondary downward crossover fell, and the low-grade secondary upward crossover soared.

MACD is called Exponential Smoothing Flat**, which is developed from the Double Exponential Moving Flat**, which is composed of the fast exponential Moving Flat** (EMA) minus the slow exponential moving flat**, the meaning of MACD is basically the same as the double moving flat**, but it is more convenient to read. When the MACD turns from negative to positive, it is a signal to buy. When the MACD turns from positive to negative, it is a signal to sell.

When the MACD changes at a large angle, the gap between the fast moving flat and the slow moving flat ** opens up very quickly, representing a shift in the general trend of the market.

Corresponding analysis on MACD:

1.The stock price rises and the MACD red bar decreases or the green bar increases, which is called the top divergence;

2.When the stock price falls and the MACD red bar grows or the green bar shortens, it is called bottom divergence;

3.When there are two ** valence peaks, such as the second peak is higher than the first, and the red peak of the second ** valence peak should be lower than the MACD red peak corresponding to the first ** valence peak, or the MACD ground green trough corresponding to the second ** valence peak is deeper than the first ** valence crest corresponding to the MACD green trough, which is called the separation of the trough top divergence;

4.When there are two ** price troughs, such as the second trough is lower than the first, and the second ** price trough should be MACD's red peak higher than the MACD red peak corresponding to the first ** price trough, or the MACD green trough corresponding to the second ** price trough is shallower than the first ** price trough should be MACD green trough, which is called the trough divergence.

Formula Calculation Method:

In the application of MACD, the fast (12-day) moving average and the slow (26-day) moving average should be calculated first, and these two values should be used as the basis for measuring the difference between the two (fast and slow lines). The so-called Difference Value (DIF) is the 12-day EMA value minus the 26-day EMA value. So, in the ongoing rally, the 12-day EMA is above the 26-day EMA.

The positive deviation (+dif) between them will get bigger and bigger. Conversely, in a downtrend, the deviation may become negative (-dif) and become larger. As for the beginning of the reversal, the positive or negative deviation should be reduced to what extent it is really a reversal signal, and the MACD's reversal signal is defined as the 9-day moving average of the deviation (9-day EMA).

In MACD's exponential smoothing smoothing** calculation rule, the weight of the most recent day is aggravated separately.

Calculation of the 12-day EMA:

EMA12 The day before EMA12 11 13 Today**Price 2 13).

Calculation of the 26th EMA:

ema26 the day before ema26 25 27 today** 2 27).

Calculation of Difference Dispersion (DIF):

dif ＝ ema12-ema26

The basic principles that the MACD indicator should follow in **:

1.When DIF and DEA are above the 0 axis, it belongs to the bullish market, and when the DIF line crosses the DEA line from bottom to top, it is a ** signal.

2. When DIF and DEA are below the 0 axis, they belong to the short market. When the DIF line crosses the DEA line from top to bottom, it is a sell signal, and when the DIF line crosses the DEA line from the bottom up, if the value of the two lines is still running below the 0 axis, it can only be regarded as a short-term **, and the trend turn can not be determined.

3. Shrinkage and enlargement of the histogram. Generally speaking, the continuous contraction of the bars indicates that the strength of the trend is gradually weakening, and when the color of the bars changes, the trend determines the turn.

4. The MACD indicator also emphasizes patterns and divergences. When the DIF line and MACD line of the MACD indicator form a high-level bearish pattern, such as head and shoulders, double head, etc., you should be vigilant; And when the MACD indicator DIF line and MACD line form a low bullish pattern, it should be considered**.

5. The indicators in the cowhide market will be distorted.

** Star asks stocks.