| As a forex trader you must always be looking for a | | | | conditions. |
| way to have a complete insight of the market and | | | | One of the most used technical indicators is the |
| how to use the behavior of the currencies in your | | | | MACD, this stands for, Moving Average Convergence |
| favor and stay away from losing trades that can | | | | Divergence. In short the MACD plots the difference |
| affect your traders account capital. | | | | between a 26-day exponential moving average and a |
| There are a number of forex technical indicators that | | | | 12-day exponential moving average. Along with these |
| will be of great help as a set of compasses ready to | | | | two lines there is also the plot of a 9-day moving |
| give you an answer even in the most stormy market | | | | average that is used as a trigger line. This means that |
| conditions. There are Bollinger bands, Fibonacci levels, | | | | when the MACD crosses below this trigger line it is a |
| RSI, Moving Averages, among others. These indicators | | | | signal that prompts you to sell and when the MACD |
| are formulas that consider the state of the markets at | | | | crosses above the line, it's a buying signal. |
| different times and according to an analysis of the | | | | We can also see the MACD indicator as this; If the |
| "recent history" of the forex market they will give you | | | | MACD turns positive, this is, if it makes higher lows |
| an indication about what should be done, this is, if | | | | consistently during a period of time, this could be a |
| entering a trade (buy or sell) has a high probability of | | | | strong buying signal. On the other side, if the MACD |
| being profitable or if you should wait for better market | | | | makes lower highs this could be a strong sell signal. |