UTRADE-FX
05-24-2010, 01:22 PM
MACD-Histogram
http://www.youtube.com/watch?v=_GJl4xDwC4E
In 1986, Thomas Aspray developed the MACD-Histogram. Some of his findings were presented in a series of articles for Technical Analysis of Stocks and Commodities. Aspray noted that MACD's lag would sometimes miss important moves in a security, especially when applied to weekly charts. He first experimented by changing the moving averages and found that shorter moving averages did indeed speed up the signals. However, he was looking for a means to anticipate MACD crossovers. One of the answers he came up with was the MACD-Histogram.
MACD-Histogram Benefits
The main benefit of the MACD-Histogram is its ability to anticipate MACD signals. Divergences usually appear in the MACD-Histogram before MACD moving average crossovers do. Armed with this knowledge, traders and investors can better prepare for potential trend changes.
1- The first point shows a sharp positive divergence in the MACD-Histogram that preceded a Bullish Moving Average Crossover.
2- On the second point, the MACD continued to new Highs but the MACD-Histogram formed two equal Highs. Although not a textbook case of Positive Divergence, the equal High failed to confirm the strength seen in the MACD.
3 - A Positive Divergence formed when the MACD-Histogram formed a higher Low and the MACD continued lower.
4- A Negative Divergence formed when the MACD-Histogram formed a lower High and the MACD continued higher
To get mor information on how to open a real account please conatct us at
www.utrade-fx.com
http://www.youtube.com/watch?v=_GJl4xDwC4E
In 1986, Thomas Aspray developed the MACD-Histogram. Some of his findings were presented in a series of articles for Technical Analysis of Stocks and Commodities. Aspray noted that MACD's lag would sometimes miss important moves in a security, especially when applied to weekly charts. He first experimented by changing the moving averages and found that shorter moving averages did indeed speed up the signals. However, he was looking for a means to anticipate MACD crossovers. One of the answers he came up with was the MACD-Histogram.
MACD-Histogram Benefits
The main benefit of the MACD-Histogram is its ability to anticipate MACD signals. Divergences usually appear in the MACD-Histogram before MACD moving average crossovers do. Armed with this knowledge, traders and investors can better prepare for potential trend changes.
1- The first point shows a sharp positive divergence in the MACD-Histogram that preceded a Bullish Moving Average Crossover.
2- On the second point, the MACD continued to new Highs but the MACD-Histogram formed two equal Highs. Although not a textbook case of Positive Divergence, the equal High failed to confirm the strength seen in the MACD.
3 - A Positive Divergence formed when the MACD-Histogram formed a higher Low and the MACD continued lower.
4- A Negative Divergence formed when the MACD-Histogram formed a lower High and the MACD continued higher
To get mor information on how to open a real account please conatct us at
www.utrade-fx.com