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Introduction to the principle of the MACD indicator, what does the MACD red column and green column mean?

2022-01-18
3693
  The macd indicator is the most classic of all technical indicators. By using the macd indicator correctly and combining the K-line and bad news, investors can basically achieve better trading results. So what is the principle of the specific macd indicator, what does the macd red column and green column mean? This article will explain these two questions to you.
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  What is the principle of the macd indicator?
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  The macd indicator is to smooth the closing price of the stock price according to the construction principle of the moving average, and then calculate after the arithmetic mean is obtained. Therefore, the macd indicator is a trend indicator.
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  The macd indicator is a double smoothing operation using fast (short term) and slow (long term) moving averages and their signs of convergence and separation. The macd developed according to the principle of moving average, on the one hand, removes the defect that the moving average frequently sends false signals, and on the other hand retains the effect of the moving average, so the macd indicator has the characteristics of moving average trend, stability and stability. , is used to judge the timing of buying and selling stocks, and it is also a technical analysis indicator to predict the rise and fall of stock prices.
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  The indicator is mainly based on the judgment of the relationship between the three values ​​of EMA, DIF and DEA (or macd, DEM), the judgment of the moving average connected by DIF and DEA, and the histogram (BAR) drawn from the DIF minus the DEM value. ) is the main technical analysis indicator of the stock market to analyze and judge the market situation and predict the short-term and medium-term trend of the stock price. Where DIF is the core and DEA is the auxiliary. DIF is the difference between the fast smoothing moving average (EMA1) and the slow smoothing moving average (EMA2). The BAR histogram uses the contraction of the red column and the green column to judge the market in the stock market technical software.
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  What does macd red column green column mean
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  In the stock market, the macd indicator is a technical indicator commonly used by investors. It consists of a diff line, a dea line, a macd bar and a zero axis. The macd bar represents the distance between the diff and dea. When When the diff in the macd indicator is less than dea, it is a green column; otherwise, when the diff is greater than dea, it is a red column.
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  Investors can look for buying and selling opportunities according to the change of the bar. For example, when the macd bar enters the green column from the red column, it is a sell signal; on the contrary, when it enters the red column from the green column, it is a buy signal. .
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  At the same time, the longer and longer macd red bars indicate that the market energy is getting stronger and stronger, and more and more people are buying. Investors can consider buying in an appropriate amount. When the macd red bars are getting shorter and shorter, it indicates that there are many parties in the market. The power is constantly declining, and investors are reducing their positions; the longer and longer macd green bars indicate that more and more people are selling in the market, and investors should focus on selling. When the macd green bars are getting shorter and shorter, it means that The power of the short side in the market is constantly declining, and investors can consider opening positions.
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  Regarding the issue of the macd indicator, this article focuses on the principle of the macd indicator, and what the macd red column and green column mean. It can be seen that the importance of the macd indicator is self-evident. Investors must really understand the meaning of the macd indicator and know how to use it flexibly.

The above information is provided by special analysts and is for reference only. CM Trade does not guarantee the accuracy, timeliness and completeness of the information content, so you should not place too much reliance on the information provided. CM Trade is not a company that provides financial advice, and only provides services of the nature of execution of orders. Readers are advised to seek relevant investment advice on their own. Please see our full disclaimer.

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