A complete guide on "How to use MACD"
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The thread will teach you.
🌟Building blocks of MACD
🌟How to interpret MACD signal
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@bhatiamanu @kuttrapali26 @KommawarSwapnil
🟢The black dot is calculated by taking difference between 12ema and 26ema.
🟢9ema is applied on the blue line which results in the creation of an orange line which is also called the signal line
🟢Histogram is plotted by taking the difference between the blue and orange line
Using MACD line (blue color) for Trend identification
🟢If MACD line is above 0 - Primary trend +ve
🟢If MACD line is below 0 - Primary trend -ve
Identification of Trend-reversal
🟢when MACD line cross below zero line primary trend changes to -ve
🟢when MACD line cross above zero line primary trend changes to +ve
Identifying the starting point of corrections
🟢Histogram turning light red is starting of +ve correction (some time fall continues)
🟢Histogram turning light green is starting of -ve correction
🟢sometimes light red/green color will also indicate starting of consolidation