MACD

Developed by Gerald Appel,

The Moving Average Convergence/Divergence stands out as one of the most straightforward, dependable, and frequently employed technical indicators.

It is a momentum oscillator and also a trend following technical indicator.

Construction

This indicator works by finding the gap between two moving averages. It draws that as the "Fast" line. The "Signal" line comes from the Fast line. Both appear in the same panel.

"Fast" line - Blue Line
"Signal" line - Red Line

The typical MACD values for the "Fast" line involve a 12-period exponential moving average with a 26-period exponential moving average MA with a 9-period exponential moving average applied to the fast line, and this plots the "Signal" line.

FastLine = difference between 12 & 26 exponential MAs moving averages
Signal Line = Moving Average of this difference of 9-periods

MACD indicator - Analysis of MACD Technical Bitcoin Indicator

BTCUSD Analysis and How to Generate Trading Signals

The MACD is often used as an indicator to follow trends and works best when looking at market changes that have a clear direction. Here are three typical ways to use MACD to find trading signals:

BTCUSD Crossovers Bitcoin Signals:

FastLine/Signal Line Crossover:

A buy cryptocurrency signal gets generated/derived when the Fast line crosses above Signal line
A sell cryptocurrency signal gets generated/derived when the Fast line crosses below the Signal line.

But, when the market is strongly going one way, this cryptocurrency signal can give you many false signals: so, the best crossover to use would be the Zero Line Crossover Signal, which doesn't give as many false signals.

Zero Line Cross over Signals:

When the Fast-line crosses above zero center-line a buy bitcoin signal is generated.
when the Fast-line crosses below zero center-line a sell bitcoin signal is generated.

Divergence Bitcoin Trading:

Looking for times when the MACD and bitcoin price don't match up can be helpful in spotting when the bitcoin price might change direction or continue going the same way. There are two kinds of these mismatches:

Classic Divergence Trade Signals
Hidden Divergence Setup Signals

Overbought/Over-sold Conditions:

The MACD indicator helps spot possible overbought or oversold spots in bitcoin price changes.

These levels and areas come about if the shorter MACD Lines move away a lot from the middle, which means the bitcoin price is going too far and will soon go back to more normal levels.

MACD & Moving Average BTCUSD Crossover Bitcoin Strategy

This btcusd tool can be used with other tools to make a cryptocurrency plan. It works well with the MA crossover way of doing things. You get a signal when both give a signal in the same direction.

Analysis of the MACD Indicator for BTCUSD Trades - Bitcoin MACD Trading Strategies Tutorial

Analysis in BTCUSD Crypto Trading

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