Moving Average Convergence Divergence (MACD) trading indicator as trade strategy Forex

Moving Average Convergence Divergence (MACD) trading indicator - it's price speed oscillator, J. Appel developed and released in his book (Signalert Corporation, 150 Great Neck Road, Great Neck, NY 11021, phone (516) 829-6444). MACD calculated in three steps:

1) Calculate difference between two exponential moving averages of close price: more slow 26-periods exponential moving average is subtracted from more fast 12-periods exponential moving average. Got oscillator, measured price change speed, drawn on chart.

2) Got oscillator smoothed by more fast exponential moving average with 9 period. This line, called "Signal", drawn on chart.

3) Second oscillator calculated: signal line is subtracted from price speed. Got price speedup drawn on chart like histogram. In depend on market Appel choose another exponential moving averages - more slow or more fast. Moving Average Convergence Divergence (MACD) trading indicator can be used on any timeframe, Appel have shown. Appel do not suggest to apply only mechanical rules for trade based on Moving Average Convergence Divergence (MACD) trading indicator. Special rules, developed by Appel, he spreads on CD, videocassettes, lectures and bulletins.

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