What does the fast MA and the slow MA represents in a MACD - page 2

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Forum on trading, automated trading systems and testing trading strategies

Advanced links/threads/tools

Sergey Golubev, 2012.09.02 09:26

One more average and variations - key thread for MT4
One more average and variations for MT5 -  the indicators for MT5 are inside this MT5 thread 

The following indicators can be found on the above mentioned threads:

  • One more average - very advanced indicators with speed changing, with smooth options and with non-adaptive/adaptive options to draw SMA, EMA, T3 (0.618 Tilson), T3 (0.618 Fulks/Matulich), SMA, harmonic mean, Hull and TEMA, Linear regression value and so on.)
  • One more average - bands
  • Classical Moving Averages indicator with colors change depending on the angle of the slope
  • BB OMacd nrp & alerts indicator (the combination of BB OMA (one more averages) and MACD OMA) and Asymmetric OMA Bands indicator
  • Guppy OMA oscillator alerts and MTF
  • Guppy OMA Long and Short indicators
  • One more average MACD indicator, averages MACD - mtf & alerts indicator, Oma macd 4 Color MTF indicator, Oma MACD 4 color MTF Interpolated indicator and Oma macd_mtf+alerts+arrows indicator
  • One more average heiken ashi indicator and One more average heiken ashi smoothed indicator
  • DMX indicator and One more average DMX indicator
  • RSX on One more average and RSX on Jurik smooth indicators
  • Oma ribbon indicator
  • RSX Channel on OMA_Sig_Alerts indicator and rsx channel on oma_alerts_mtf indicator
  • TrendStrength Oma Channel_MTF_Alerts indicator, Oma TrendStrength Channel indicator, TrendStrength oma channel_mtf_alerts-1 indicator and Range oma with bands_arrows_alerts indicator
  • Oma_Envelopes_v2 indicator and cfb adaptive averages envelopes indicator

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Prepare for the flood... 


Like i said, look elsewhere

 
schaff_trend_cycle_jurik_macd indicator - the post.
 
Enrique Dangeroux:

Prepare for the flood... 


Like i said, look elsewhere

Those are the links to the threads/posts related to MACD: the threads/posts were originally started on former tsd forum and were moved later to this mql5 forum.
So, those threads/posts are unknown for mql5 users.
That is why I am posting such a collection.

 
Sergey Golubev:
Everything about MACD indicator - the thread

Thank you Segey


Thus, he refers to these three moving averages



as 7.5%, 15%, and 20% respectively.)[/CODE]


This is one of the things im looking for, but the rest of the thread is indicators and EAs


If you can refer to such information i'll be greatfykl


Enrique Dangeroux:

Good call! Forget profits, and understand how and why. The profits will follow.

There are various good sources to learn how to use indicators or how they (mathematically) work. This website is paranoid about external linking, google "MACD indicator" and you should find everything you need.


I downloaded and read lots of parts of his book "Understanding MACD" but i feel its not so useful so far, he mentions how the indicator works with other indicators and gives examples of the fast MA with the slow MA combination without giving a reason why should one chose the numbers "based on what"


I'll keep searching google though lets see where will i find what im looing for

 
That the expert normally worked. It should have all available settings.
See the MACD indicator settings 
//--- input parameters
input int                InpFastEMA=12;               // Fast EMA period
input int                InpSlowEMA=26;               // Slow EMA period
input int                InpSignalSMA=9;              // Signal SMA period
input ENUM_APPLIED_PRICE InpAppliedPrice=PRICE_CLOSE; // Applied price
And compare with the expert MACD Sample 
if((m_handle_macd=iMACD(NULL,0,12,26,9,PRICE_CLOSE))==INVALID_HANDLE)

Default MACD parameters. And we will not be able to adjust it as we want.

P.S. Purely for reflection.

 

MACD

Moving Average Convergence/Divergence (MACD) is a trend-following dynamic indicator. It indicates the correlation between twoMoving Averages of a price.

The Moving Average Convergence/Divergence (MACD) Technical Indicator is the difference between a 26-period and 12-periodExponential moving averages (EMA). In order to clearly show buy/sell opportunities, a so-called signal line (9-period moving average of the indicator) is plotted on the MACD chart.

The MACD proves most effective in wide-swinging trading markets. There are three popular ways to use the Moving Average Convergence/Divergence: crossovers, overbought/oversold conditions, and divergences.

Crossovers

The basic MACD trading rule is to sell when the MACD falls below its signal line. Similarly, a buy signal occurs when the Moving Average Convergence/Divergence rises above its signal line. It is also popular to buy/sell when the MACD goes above/below zero.

Overbought/Oversold Conditions

The MACD is also useful as an overbought/oversold indicator. When the shorter moving average pulls away dramatically from the longer moving average (i.e., the MACD rises), it is likely that the symbol price is overextending and will soon return to more realistic levels.

Divergence

An indication that an end to the current trend may be near occurs when the MACD diverges from the symbol. A bullish divergence occurs when the Moving Average Convergence/Divergence indicator is making new highs while prices fail to reach new highs. A bearish divergence occurs when the MACD is making new lows while prices fail to reach new lows. Both of these divergences are most significant when they occur at relatively overbought/oversold levels.

You can test the trade signals of this indicator by creating an Expert Advisor in MQL5 Wizard.

Moving Average Convergence/Divergence

Calculation

The MACD is calculated by subtracting the value of a 26-period exponential moving average from a 12-period exponential moving average. A 9-period dotted simple moving average of the MACD (the signal line) is then plotted on top of the MACD.

MACD = EMA(CLOSE, 12) - EMA(CLOSE, 26)

SIGNAL = SMA(MACD, 9)

Where:

EMA — Exponential Moving Average;
SMA — Simple Moving Average;
SIGNAL — the signal line of the indicator.

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