Simple MACD crossovers and EMAs

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Simple MACD crossovers and EMAs

Postby George FXtrades » Fri Sep 25, 2009 9:59 am

Hello Edward,

Currency Pair: EUR/USD
Time Frames: five mins and one hour
EMAs: 10, 25 and 50
MACD: 12, 26, 9 and 6, 13, 9.

My problem relates to the MACD line crossover the Signal line from above or below and establishes a BUY or SELL situation. However, I notice on many occasions the MACD/Signal line crossovers do not match up to the corresponding EMAs crossovers for the BUY or SELL entry simultaneously. Nevertheless, the candlestick charts of EMAs show the clearer picture of the discrepancy.

The discrepancy may be due to differences in indicator settings for respective time frames that you may have in record.

In this instance, which indicator should be used for the BUY or SELL decision? (Follow the crossovers or the MACD/Signal Line or EMAs).

In addition, if the EMAs crossover was the indication for entry, one has to wait for sometime (could be > 6 hours on 1-hour time frame) before the next EMAs crossover to happen for the exit, and meanwhile the MACD/Signal line had experienced a few earlier crossovers within that duration. Relying upon the prior MACD/Signal line crossover may lead to a pre-mature exit.

Finally, is there a relationship between the size of the MACD histogram with the volume of business transacted at that particular instance?

What are your views to a trading situation like this?

Thank you.

Regards.

George FXtrades.
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Re: Simple MACD crossovers and EMAs

Postby manus168 » Sat Sep 26, 2009 3:33 am

Dear GeorgeFX;

I just want to share my thought, your setup is very good.

Btw for me i just want to used EMA 10 By Close & EMA 50 By Closed + CCI Histogram(34) with Level 0. I don't used MACD

Rules :

We can trade By Cross over EMA 10 & 50 with confirmation of CCI(34) Histogram

For Buy setup EMA 10 Cross Up from EMA 50 & for confirmation CCI(34) Histogram is above 0 Line;

For Sell Setup EMA10 Cross Down from EMA 50 & for confirmation CCI(34) Histogram must be bellow the 0 Line.

Exit : When we saw CCI Divergence, or Price Cross EMA 10 By Close.

Re-Entery : If the trend is longer & we've gotted stopped out, we can re-enter with EMA 10 (retrachement) as long the trend is same.

Here the example at EUR/USD m5:

Image

But iMo: its better if we trade GBP/USD at H1, they give us more profitable :

Image


here's the Indicators & Templates setup if we want to check/experiment :

Code: Select all
http://www.forexsharing.com/309493



Sincerly;


:)


Manus168
Yesterday = HISTORY !
Tomorrow = MYSTERY!
Today = GIFT !


Thats why we call it the PRESENT :)
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Re: Simple MACD crossovers and EMAs

Postby Edward Revy » Wed Oct 07, 2009 5:32 pm

Using MACD alongside with EMAs is not the best choice, since MACD itself consists of 2 Moving averages (12 and 26).
You'll be using a similar data, even though MACD measures convergence/divergence between 12 and 26 MAs.
So, to avoid confusion of whether to enter with MACD signals or EMAs, pick just one indicator and from there seek confirmation from indicators of a different group:
to get the idea, you may review the following article:

How to choose the best combination of Forex indicators

There would be no meaningful relationship between the size of the MACD histogram and the volume of business transacted, because unlike in stock market, in Forex you cannot evaluate volume properly.

Regards,
Edward
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Re: Simple MACD crossovers and EMAs

Postby Edward Revy » Wed Oct 07, 2009 5:37 pm

Hi Manus168,

thank you for highlighting yet another good simple system.

Besides all, I particularly like the way CCI indicator is displayed. Really handy. Thanks for sharing!

Regards,
Edward
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Re: Simple MACD crossovers and EMAs

Postby manus168 » Wed Oct 21, 2009 3:21 am

Edward Revy wrote:Hi Manus168,

thank you for highlighting yet another good simple system.

Besides all, I particularly like the way CCI indicator is displayed. Really handy. Thanks for sharing!

Regards,
Edward


You're welcome Bro ... :wink:

However, the CCI Histogram in Grey colours it means : base the Woodies CCI(14) the trend has allready develops if the histogram allready 6 bar above (for Bull)/6 bar bellow (for bear) the 0 line.

You can modify them in input.


Happy Trading Bro;


:mrgreen:


Manus168
Yesterday = HISTORY !
Tomorrow = MYSTERY!
Today = GIFT !


Thats why we call it the PRESENT :)
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