Testing Simple Strategies: MACD Works and Futures are Rewarding

Traders are fascinated by indicators. But just because something is interesting, logical or mystical does not mean it works in the market. Testing is needed to be sure the indicator adds value, and we will define value as improving profits. If an indicator beats a simple trend following strategy, it adds value.

Trading Without Software

When just starting out, some beginning traders will want to use all of their available funds to trade rather than buying software and data feeds. In this article, we’ll look at how that can be done, using free end of day data and indicators.

Inside the MACD Indicator

By Alan Hull, AlanHull.com The MACD, Moving Average Convergence Divergence, indicator is probably the most popular indicator in use today. It is also one of the most misunderstood, with it often being described amongst chartists as ‘An average of an average’. Before we begin to dissect the MACD indicator it is necessary to mathematically define

MACD

The MACD oscillator developed by Gerald Appel uses two exponential moving averages of closing prices. These are turned into a momentum oscillator by subtracting the longer moving average from the shorter moving average. This is the faster line you see on the chart. The slower line, called the signal line is a 9 period exponentially