MACD Technical Analysis Buy and Sell Trading Signals

Since the MACD indicator uses 26 and 12 EMA to plot, we shall compare these two EMAs with the MACD indicator to determine how these buy & sell signals are generated.

MACD Energies Indicator - Example of MACD Energies Trading Technical Indicator

The MACD indicator is a leading indicator meaning it generates energies signals that are leading compared to energies price action as opposed to lagging indicators that lag behind the energies price.

Buy Energies Trade

A buy energies trade is generated when there's a MACD fast line crosses above the signal line. However, as with any leading indicator these energies trading signals are prone to whip-saws/fake-outs.

To eliminate the whipsaws it's good to wait for confirmation of the buy or sell signals. The confirmation energies signal is when the two lines cross above the zero mark, when this happens the buy generated is a reliable energies signal.

In the energies example illustrated and explained below, the Moving average energies indicator generated a buy signal, before energies price started to move up. But it wasn't until the MACD moved above the zero line that the buy signal was confirmed, and the Moving Averages also gave a crossover energies signal. From experience it's always good to buy after both the MACD lines move above zero center line mark.

Where to Buy using MACD Energies Trading Indicator - Buy Trading Signal

Sell Energy Trade

A sell signal is generated when there is a MACD fast line crosses below the signal line. However, just like the buy signal, these are also prone to whipsaws/ fake outs.

To eliminate the whipsaws it's good to wait for confirmation of the sell signal. The confirmation is when the two lines cross below the zero mark, when this happens the sell generated is a reliable energies signal.

In the energies example illustrated and explained below, the Moving average generated a sell confirmed after MACD moved below the zero line at the same time that the Moving Averages gave a crossover energies signal.

Where to Sell using MACD Energies Indicator - Sell Trading Signal