MACD Questions

[mrchuffster]

I'm interested in short term swings (1-10 days)

I've been learning some indicators recently. Using MACD crossovers/divergances looks good as an indicator until you actually go back and count how many times it's right which is about 50/50.
My question is, what other indicators would you use to give you an edge over 50/50 on short term channels.

I have looked at RSI and Volume but they still dont seem to tip the balance.

Your thoughts much appreciated.

 

[JonnyT]

Don't use indicators.

I do not beleive they give any edge.

JonnyT

 

[mrchuffster]

Don't use indicators.

I do not beleive they give any edge.

JonnyT

If you dont use indicators what other methods are there ?

 

[JonnyT]

Simple Price Action.

JonnyT

 

[The Beyonder]

I agree with Jonny.

I've tried all sorts of indicators and found in the long run that they're unpredicatible.

Have a look at charting patterns like Hammers, haramis etc. Get a good candlestick book.

 

[Carley1]

Swing Trading Stock Market Indices with MACD

I agree with Jonny.

I've tried all sorts of indicators and found in the long run that they're unpredicatible.

Have a look at charting patterns like Hammers, haramis etc. Get a good candlestick book.

If you follow the stock market indices, you know that because of market volatility swing trading is the only way to trade index futures contracts. We have developed a system that is effective through the use of MACD and MA crossovers. The system is technical, but we incorporate what we call a common sense filter.

Thanks,
Carley

 

[weyhey]

Using oscillators on their own is very dangerous. Try using them with support and resistance area's and you might have more success.

 

[maxpain]

Use your own settings,

depending how fast you want it to react. 4.8.8

 

[Carley1]

Using oscillators on their own is very dangerous. Try using them with support and resistance area's and you might have more success.

Exactly, that is part of what we call the "common sense" filter

 

[harryc]

I've used MACD and M/A's on Candlestick charts for years now with a good degree of success for FTSE futures .

Agree with JonnyT you got to always first and foremost take account of price Action ( that's ALL that really matters ultimately ) .

Some people just don't 'get-on' with indiactors and it's true that using them alone will not get you far .

 

[mr_cassandra]

Macd is good if.....

You bear in mind it has a rigid time set when giving you signals. If your vehicle is trading in a time frame that doesn't agree with the macd time frame, you will get false signals. This consideration affects most TA oscillators.

I'm interested in short term swings (1-10 days)

I've been learning some indicators recently. Using MACD crossovers/divergances looks good as an indicator until you actually go back and count how many times it's right which is about 50/50.
My question is, what other indicators would you use to give you an edge over 50/50 on short term channels.

I have looked at RSI and Volume but they still dont seem to tip the balance.

Your thoughts much appreciated.

 

[Salty Gibbon]

I have successfully incorporated MACD into my trading but it took a long time and a lot of study and trial and error before I felt able to rely on the signals that it was producing.

Primarily I use price action, volume, basic TA and a 9 period EMA for my trading. I only use MACD to add a bit of weight / back-up ( or otherwise ) to what I think I am seeing from price, volume etc.

But I am happy to use it for confirmation purposes - it works within my own personal system - and I win many many more trades than I lose - more importantly I now win consistently on a daily basis.

Yes I am happy with MACD, but not as an end in itself, and only after a great deal of study and trials.

 

[JumpOff]

Price action and volume (or tick pressure on instruments that don't have volume) are the only current indicators.

I find MACD action to be most helpful as a last confirming signal to exit a position, rather than as an entry tool. For instance, if I entered a position by looking an hourly chart, I would look to a positive daily MACD pattern to keep me in a position (as long as it is still profitable) , then looking for a crossing back over the horizon as one indicator that the move was really done. All indicators are lagging, - so if you're not out by the time you see an MACD cross the horizon, you need to be asking yourself what you don't understand about what you are seeing....

Still, if I had any question about which to follow - price action or MACD, I'd go with price action every time...
JO

 

[Roberto]

I think it's true that people either get on with indicators, or they don't. Like harryc above, I started off with them (I suspect most people do) and had a very lucky run intraday trading a few indices by spreadbetting - enough to give up my job after a couple of years. Gradually I've grown to mistrust them more and more. I still have some MA's and MACD-histogram and RSI on most of my my charts, and I now use them as a confidence-boosting confimration of my thoughts about price. It's been a slow and difficult re-education process. Over the last year, I would possibly have done better without the indicators there, which is an interesting but still slightly scary thought!

I would tend to advise anyone starting out to be thinking about breakouts and support and resistance, and maybe reading Nison's excellent book (mentioned above) and Martin Pring's "Candlesticks Explained" paperback and accompanying CD. But having said that, I also find that I'm gradually progressing (at least, I hope it's "progressing") from candlesticks to bar charts as well.

 

[waverider]

I'm always interested to hear people decry indicators as 'lagging'. Surely watching current price action is only of use in its relation to previous price action? A single candlestick is of no (or at least very little) use by itself....it has to have the context a few prior candlesticks, and is therefore similarly 'lagging'. Even breakouts are lagging since they depend on previous s/r levels.

I'm not saying its better with or without indicators - my guess is there are people being successful using both approaches - just that all trading decisions carry an element of observation of what's happened in the recent past. I guess we all pick whatever combination of information sources we feel works best for us.

WR