A simple way of trading with MACD

The MACD indicator is one of the default MT4. This indicator is an indicator that shows the turn of the trend. This is actually very simple indicators used in forex trading. We do not need to use multiple indicators to determine the turn nor the direction of the trend, as it will only add to the clutter.

The MACD parameters on MT4 usually 12, 26, 9. We actually can change the parameters that correspond to the tastes and our beliefs, but it turns out that the default parameters allow a user to use it in trade.

MACD consists of 3 components:

1. Zero Line

2. Histogram

3. The signal Line

The following overview of the MACD indicator:

The zero line is the line which divides into two parts namely the MACD (Bullish) and the bottom (Bearish), and being in 0000 parameters required.

The histogram is a set of bars that are a sign the volume of trade is going on. If the histogram is getting longer then the greater the volume of trade, whereas if the histogram then shrink the trading volume of fewer as the sign of correction will occur.

The signal line is the dotted line as a signal for the open position if the buy or sell.

How do I determine the buy or sell with MACD?

Note the picture below:

Note When the Signal Line crossed with the histogram.

Open to Buy

If the signal line crosses the histogram from the bottom up, then the candlestick close already exceed the nearest resistance then we Buy.

Open to Sell

If the signal line crosses the histogram from top to bottom, then the candlestick closed already exceed the nearest resistance then we Sell.

To take profit we don't be greedy, let them we have got 500 points (for the 5-digit) or 50 points (to 4 digits). The important thing in trading is that we don't get greedy and keep in mind that don't many open positions because it's very risky. We don't get too confident with our CO-OP, because sometimes we cannot market predictions. We can do only limited to identify trends. One of them is by using the default MT4 indicators, namely the MACD.

Remember only the indicators as a tool to read the trend but not a guarantee of 100% for profit. All depends on ourselves.

Okay, here we are learning about how to read the MACD indicator with simple explanations. Maybe useful for friends