Two moving averages and the macd

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Old Oct 5, 2017, 8:54am   #1
 
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Two moving averages and the macd

Hi everyone. I am just starting out in trading and I have some experience although I class myself as a novice and I am still studying the different methods. I am having difficulty with one area in particular and I cannot seem to find an answer anywhere.

The macd indicator has a default of 12 short, 26 long and 9.

When using the macd indicator what is the best time frame in terms of using two moving averages on the chart above macd i.e. 6,21, or 50, 100 and so forth?

Whatever moving average time frame you use, should the macd always be kept in the default settings?

Sorry if this sounds technical or confusing, hope I got that out right.

Would appreciate any feedback. Thanks.
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Old Oct 5, 2017, 3:17pm   #2
 
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My best MA's are my two eyeballs and what's b/w my ears. I NEED little else.
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Old Oct 5, 2017, 3:24pm   #3
 
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Quote:
Originally Posted by crashburn1975 View Post
Hi everyone. I am just starting out in trading and I have some experience although I class myself as a novice and I am still studying the different methods. I am having difficulty with one area in particular and I cannot seem to find an answer anywhere.

The macd indicator has a default of 12 short, 26 long and 9.

When using the macd indicator what is the best time frame in terms of using two moving averages on the chart above macd i.e. 6,21, or 50, 100 and so forth?

Whatever moving average time frame you use, should the macd always be kept in the default settings?

Sorry if this sounds technical or confusing, hope I got that out right.

Would appreciate any feedback. Thanks.
Before risking any money, plot your MACD with a variety of MA pairs in order to find out whether or not any of them tell you what you need to know quickly enough for you to do anything about it. Since the MACD and MAs "indicate" the same thing, it is more likely that you will receive conflicting signals than confirming ones. Nonetheless, if these signals appear too late for you to benefit from them, you may want to pursue other investigations.
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Old Oct 5, 2017, 3:44pm   #4
 
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crashburn1975 started this thread Hi, many thanks for that information. Ok, time to test things out. Still wondering about about the default periods on macd though, should these generally remain unchanged?

Thanks anyway.


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Originally Posted by dbphoenix View Post
Before risking any money, plot your MACD with a variety of MA pairs in order to find out whether or not any of them tell you what you need to know quickly enough for you to do anything about it. Since the MACD and MAs "indicate" the same thing, it is more likely that you will receive conflicting signals than confirming ones. Nonetheless, if these signals appear too late for you to benefit from them, you may want to pursue other investigations.
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Old Oct 5, 2017, 3:51pm   #5
 
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crashburn1975 started this thread
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Originally Posted by piphoe View Post
My best MA's are my two eyeballs and what's b/w my ears. I NEED little else.
Well, yes, I am very much the same but I do like to focus on an indicator or two
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Old Oct 5, 2017, 4:48pm   #6
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Hi crash.

I like trend-following and I like to use 2EMAs to confirm trend. When price and the 20EMA are above the 50 and the 50 is sloping upwards, that's an uptrend. Its not necessarily an uptrend to buy into but its worth a closer look. No off-chart indicators add anything to this set-up.

A closer look would reveal lots more info direct from price bars, both daily and weekly and its easy to build a short check-list of what TA criteria must be showing as "green lights" so you can know when to buy but also know which uptrend out of any number is stronger.
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Old Oct 5, 2017, 5:10pm   #7
 
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crashburn1975 started this thread
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Originally Posted by tomorton View Post
Hi crash.

I like trend-following and I like to use 2EMAs to confirm trend. When price and the 20EMA are above the 50 and the 50 is sloping upwards, that's an uptrend. Its not necessarily an uptrend to buy into but its worth a closer look. No off-chart indicators add anything to this set-up.

A closer look would reveal lots more info direct from price bars, both daily and weekly and its easy to build a short check-list of what TA criteria must be showing as "green lights" so you can know when to buy but also know which uptrend out of any number is stronger.
Hi tomorton

Many thanks for that information, that's really helpful. I'm just deciding what moving averages to use i.e. short term 6/21, mid term 50/100. Guess I'll just have to experiment but I am interested in long term profits rather thank making a quick buc as they say Thanks again.
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Old Oct 5, 2017, 5:19pm   #8
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Yes, experiment is right, it won't take long. A 50 or 100 is good for confirming what is the long-term trend: personally I find the 200 so long its unresponsive. You can take the risk of a counter-trend trade against this trend but you'd have to have a damn sure set-up for the short-term win.

A short MA crossing a somewhat one is good for XO signals, 6/21 will give you plenty as they are both so short, sometimes just a few days apart, and many will not follow through even with the underlying long-term trend in your favour.

XO's aren't a complete strategy in themselves - its the uptrend that's important in making price go up, not the MA XO entry signal.
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