How to Use MACD for Trading

MACD (Moving Average Convergence Divergence) is a "momentum-trend" hybrid. It helps you identify when a trend is accelerating or beginning to lose steam.

Watch the Histogram

The histogram shows the distance between the two MACD lines. When it gets larger, momentum is increasing. When it shrinks, a reversal may be near.

Identify Signal Crossovers

A crossover of the signal line can be an entry signal, but only when it happens in the direction of the overall trend.

Common Mistakes to Avoid

/Taking every "zero-line cross" as a trade
/Using it on very low timeframes where it generates too much noise

The Drawdown Way

Our indicators phase covers the mathematical reality behind the MACD so you know exactly what it's telling you.

Master Indicators

Questions & Answers.

Which is better, RSI or MACD?

Neither is "better." RSI measures price speed, while MACD measures the relationship between two moving averages. Many traders use both for confirmation.

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