标题: [技术分析] A Primer On The MACD by Casey Murphy [打印本页] 作者: Brainteaser 时间: 2009-12-31 07:08 标题: A Primer On The MACD by Casey Murphy
Learning to trade in the direction of the short-term momentumcan be a difficult task at the best of times, but it is exponentiallymore difficult when one is unaware of the appropriate tools that canhelp. This article will focus on the most popular indicator used intechnical analysis, the moving average convergence divergence(MACD). This indicator was developed by Gerald Appel in the 1960s andalthough the name of this indicator sounds very complicated, it'sreally quite simple to use. Read on to learn how you can start lookingfor ways to incorporate this powerful tool into your trading strategy.
Background Knowledge Thepopularity of the MACD is largely attributable to its ability to beused to quickly spot increasing short-term momentum. However, before wejump into the inner workings of the MACD, it is important to completelyunderstand the relationship between a short-term and long-term moving average.
As you can see from the chart below, many traderswill watch for a short-term moving average (blue line) to cross above alonger-term moving average (red line) and use this to signal increasingupward momentum. This bullish crossoversuggests that the price has recently been rising at a faster rate thanit has in the past and is a common technical buy sign. Conversely, ashort-term moving averagecrossing below a longer-term average is used to illustrate that theprice of the asset has been moving downward at a faster rate and thatit may be a good time to sell.
Figure 1
The Indicator Notice how the moving averages diverge away from each other in Figure 1 as the strength of the momentum increases. The MACD was designed to profit from this divergenceby analyzing the difference between the two exponential movingaverages. Specifically, the value for the long-term moving average issubtracted from the short-term average and the result is plotted onto achart. The periods used to calculate the MACD can be easily customizedto fit any strategy, but traders will commonly rely on the defaultsettings of 12- and 26-day periods. (For related reading, see Divergences, Momentum And Rate Of Change.)
Apositive MACD value, created when the short-term average is above thelonger-term average, is used to signal increasing upward momentum. Thisvalue can also be used to suggest that traders may want to refrain fromtaking short positions until a signal is generated that suggests it isappropriate to do so. On the other hand, falling negative MACD valuessuggest that the downtrend is getting stronger and that it may not bethe best time to buy.
Transaction Signals Ithas become standard to plot a separate moving average alongside theMACD, which is used to create a clear signal of when the momentum isshifting. A signal line,also known as the trigger line, is created by taking a nine-periodaverage of the MACD and is found plotted alongside the indicator on thechart. As you can see in Figure 2, transaction signals are generatedwhen the MACD line crosses through the signal line (nine-period exponential moving average (EMA) - dotted blue line).
Thebasic bullish signal (buy sign) occurs when the MACD line crosses abovethe signal line, and the basic bearish signal (sell sign) is generatedwhen the MACD crosses below the signal line. Traders who attempt toprofit from bullish MACD crosses that occur when the indicator is belowzero should be aware that they are attempting to profit from a changein the direction of the momentum, while the moving averages are stillsuggesting that the security could experience a short-term sell off.This bullish crossover can often correctly predict the reversal in thetrend as shown in Figure 2, but it is often considered riskier than ifthe MACD were above zero.
Figure 2
Another common signal that many traders watch for occurs when theindicator travels in the opposite direction of the asset's, known asdivergence. This concept takes further study and is often used byexperienced traders. (For more on this see, Tales from the Trenches: Trading Divergences In FX.)
The Centerline Asmentioned earlier, the MACD indicator is calculated by taking thedifference between a short-term moving average (12-day EMA) and alonger-term moving average (26-day EMA). Given this construction, thevalue of the MACD indicator must be equal to zero each time the twomoving averages cross over each other. As you can see in Figure 3, across through the zero line is a very simple method that can be used toidentify the direction of the trend and the key points when momentum isbuilding.
Figure 3
Advantages In the previous examples, thevarious signals generated by this indicator are easily interpreted andcan be quickly incorporated into any short-term trading strategy. Atthe most basic level, the MACD indicator is a very useful tool that canhelp traders ensure that short-term direction is working in theirfavor.
Drawbacks The biggest disadvantage of using this indicator to generate transaction signals is that a trader can get whipsawedin and out of a position several times before being able to capture astrong change in momentum. As you can see from the chart, the laggingaspect of this indicator can cause several transaction signals to begenerated during a prolonged move and this may cause the trader torealize several unimpressive gains or even small losses during therally.
Figure 4
Traders should be aware that the whipsaw effect can be severe in both trending and range bound markets, becauserelatively small movements can cause the indicator to change directionsquickly. The large number of false signals can result in a tradertaking many losses. When commissions are factored into the equation,this strategy can become very expensive.
Another drawback of theMACD is its inability to make comparisons between different securities.Because the MACD is the dollar value between the two moving averages,the reading for differently priced stocks provides little insight whencomparing a number of assets to each other. In an attempt to fix thisproblem, many technical analysts will use the percentage price oscillator,which is calculated in a similar fashion as the MACD, but analyzes thepercentage difference between the moving averages rather than thedollar amount. (To hear more about the case against the MACD, read Candle Sheds More Light Than The MACD.)
Conclusion TheMACD indicator is the most popular tool in technical analysis becauseit gives traders the ability to quickly and easily identify thedirection of the short-term trend. The clear transaction signals helpminimize the subjectivity involved in trading and the crosses over thesignal line make it easy for traders to ensure that they are trading inthe direction of the momentum. Very few indicators in technicalanalysis have proved to be more reliable than the MACD, and thisrelatively simple indicator can quickly be incorporated into anyshort-term trading strategy. by Casey Murphy, (Contact Author | Biography)
