This is better for comparing momentum across different securities. This script is a standard PPO but with many options for customization.
You can set the moving average type of the signal and the oscillator lines separately. You can also weight any moving average of the PPO by volume. Supported Types of MA This is MACD indicator on the price chart. You can read the same information as the original MACD but much more.
You can use it the same way as MACD but it won't use any space below your chart. Also you can use signal line and cloud as trend confirmation: e. The signal line yellow by default can be used as a This smoothing eliminates the noise of the classic MACD as you see in the Chart Adaptive MACD is compiled using with two adaptive moving averages, one adaptive to the dominant cycle and the other adaptive to twice the dominant cycle.
As the basic behind the MACD is the difference of TradingView PT. Todos os Scripts. Apenas Indicadores. Apenas Fontes Abertas. SPY Ninja Oscillator. It is a graphical representation of the distance between the two lines. If you look at our original chart, you can see that, as the two moving averages MACD Line and Signal Line separate, the histogram gets bigger. As the moving averages get closer to each other, the histogram gets smaller. And that, my friend, is how you get the name, M oving A verage C onvergence D ivergence! Whew, we need to crack our knuckles after that one!
First of all, it is necessary to clearly understand that using the indicator on the older timeframe gives significantly fewer errors due to the filtering of market noise. One of the main advantages of MACD is that it combines the elements of both the oscillator and the trend indicator in one indicator. Another advantage is that it is more visible in better than other indicators, reveals divergences and price convergence. Divergence is the signal of a possible reversal or price correction.
Convergence, respectively, is the opposite — it is a signal of a possible continuation of the trend, which is a discrepancy between the indications of the indicator and the direction of the price movement. This indicator builds a divergence line between the current price and the MACD, and also gives signals to buy or sell by displaying the green and red arrows. There is a built-in alert function. Bullish divergence is indicated by green lines, bearish — red. If the divergence is classical, the line on the price chart will be solid, and if the type is reversal, the line will be dotted.
Download indicators you can follow the link at the end of the article.
As we can see, the intersection of the MACD line with the trend line gives significantly earlier and qualitative signals about the trend change than the intersection with the zero level vertical blue lines on the graph. This approach fully discloses MACD as a trend indicator. And it is necessary to recheck these signals, including divergence signals, for compliance with your trading strategy and the rules of opening deals. Signals are calculated mathematically and do not take into account anything other than prices in numerical terms.
Your task is to correctly interpret the signals of the indicator and to filter out the mistakes.
To filter transactions, you need to add a rule for opening deals only in the direction of the trend movement, which will be confirmed by finding the MACD line above or below zero. And we have a practically complete trading strategy in the foreign exchange market.
It should be noted a very interesting trend associated with the use of the indicator MACD to assess the divergence through trend lines. After crossing the MACD indicator line with its trend line, the price very often makes a new minimum or maximum in the direction of the previous trend or tests the previous one , but only after that the price turns.