MACD Trading Indicator Crossover Signals

MACD Center line crossovers generate signals using the center line mark. The sentiment of the market can be confirmed using the MACD center line crossovers.

MACD crossover above the center line mark generates bullish market sentiment while crossover below the center line generates bearish market sentiment.

• When the Fast line crosses below the MACD Line (not center mark) it shows market momentum is slowing - this is not a reversal signal or a sell signal, wait for center mark crossover.
• When the Fast line crosses above the MACD Line (not center mark) it shows the market momentum is slowing - this is not a reversal signal or a buy Stock Indices signal, wait for center mark crossover.
• The Center-Line crossover signals will be the best signals for confirming buy & sell signals.

Using the trade chart in the example below, when MACD fast line crossed below the zero center mark, sell signal was confirmed and the market sentiment changed to bearish - downward trend.

Also in the example below when MACD fast line later crosses above zero center mark, a buy Stock Indices signal was generated and the market sentiment changed to bullish - upward trend.

MACD Zero-Line Mark Crossover - Precisely When a Sell Signal and Buy Signal are Generated

Oscillation of the MACD Indicator

The MACD indicator is an oscillator indicator that moves up & down around a zero center line mark. The center-line is the neutral measurement, values above zero will indicate bullish market trend while values below indicate bearish market trend.

The MACD indicator is also used to indicate overbought & oversold levels. When the MACD reaches overextended levels, then a Stock Indices is overbought or oversold. However, in a strong upwards trending Stock Indices market prices will stay overbought in this case its better to buy the Stock Indices.

Also in a strong down trending Stock Indices market its better to sell the Stock Indices, because prices will stay in the oversold region for a long time.

Overbought conditions occur above the zero line while oversold conditions occur way below the zero mark.

MACD Overbought Region - Stock Indices Trend Continuation Signal