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Is The FOREX The Market To Trade Your Way to Riches?Ever watch the news and see the ending FOREX trades of the currency markets? They're usually based on how individual currencies traded against the dollar. FOREX is the abbreviation for the Foreign Exchange market. FOREX is a market where the...
Trading forex to advance your financial position
Everyday, currencies are traded in an international foreign exchange market, otherwise known as the forex market, with the main marketplaces (otherwise known as bourses) existing in the world's financial centes New York, London, Tokyo, Frankfurt...
Two Great Forex Indicators: Bollinger Bands and Fibonacci Retracements.
Forex trading is a fascinating way of earning a living online, and if you are seriously considering entering this fascinating world of forex trading you must consider, by all means, the learning and understanding of a number of indicators that...
Forex Strategy: How The MACD Indicator Can Save You Anxiety
The MACD (Moving Average Convergence Divergence) indicator can add a degree of certainty to your Forex strategy.
As with any indicator, it is too risky to enter trades on this signal alone. However, as we will see, used with caution on higher time frames, it can help confirm you are going in the right direction and that your trade is higher probability.
First, let’s take MACD apart and describe it’s component parts.
The default MACD on most charting packages sets 2 EMA’s (Exponential Moving Averages) at 26 and 12 days.
This is represented by a colored line (color varies according to charting package) which crosses a different colored 9 EMA often termed the trigger line.
When MACD (the 12/26 EMA) crosses above the trigger line (9 EMA) upward momentum is indicated and vice versa.
A center line, or zero line, often called the water line is also shown in the MACD indicator. When MACD is above the water line an upward trend is indicated, when it is below the water line, a downward trend is indicated.
MACD also includes a histogram, small vertical lines that appear above or below the zero line, not unlike mountains and valleys in appearance.
MACD is a lagging indicator which follows price action.
The histogram is an indicator of MACD. So watching the histogram can give you an early indication of where MACD is going. The height of the histogram can be a good momentum indicator.
How can you use MACD to your advantage?
If you want to be very cautious in your Forex strategy, going only for high probability trades, then pay attention to MACD on the 4 hour and 1 hour charts.
Some traders will only enter a
trade when the 4 hour and 1 hour MACD’s are going in the same direction. This will mean a lot less trades but the ones you do take are likely to be profitable. (Agreement of the two MACD’s is used in conjunction with other indicators, not by itself.)
MACD on the 1 hour chart is particularly powerful. If you want to stay out of trouble and avoid trades you might later regret, NEVER trade against the direction of the 1 hour MACD. To do otherwise is not necessarily foolhardy if you know what you are doing.
But for the newer, less experienced trader, only trading long when MACD has crossed up, or short when MACD has crossed down on the hourly chart when your other favorite indicators line up, will make for a higher success rate with your Forex strategy. It will also save you much anxiety!
To see the above information presented graphically, follow the link in the Resource Box.
Michael A. Jones is a writer and webmaster with over 10 years experience who also trades the forex regularly. For screen shots of MACD with explanatory notes go to this page: www.vitalstop.com/Forex/forex-strategy-macd-indicator.html
Click here for his advice for absolute beginners: www.vitalstop.com/Forex/learn-to-trade-the-forex.html
Michael has also put together a list of key free resources which he finds invaluable: www.vitalstop.com/Forex/forex-directory-free-resources.html
Written By: Michael A. Jones
 Globe and Mail | WORLD FOREX: Dollar Drops As Rate Outlook Boosts Risky Assets Wall Street Journal NEW YORK (Dow Jones)--The dollar declined against higher-yielding currencies Wednesday afternoon, ... FOREX-Dollar falls vs most majors; euro off 5-week highs FOREX-Dollar slides after FOMC, yen pressured on BOJ WORLD FOREX: Dollar Stuck In Narrow Ranges; Pound Up On Data |
FOREX-Dollar rebounds broadly; AUD and CAD off highs Reuters ... dollar yet after getting done with major central bank events this week," said Hiroshi Maeba, executive director of forex trading at Nomura Securities. ... |
 istockAnalyst.com (press release) | Forex - Dollar mixed against rivals after US PPI data Forex Pros Forex Pros – The US dollar was mixed against other major currencies on Wednesday, following the release of disappointing data on producer prices in the ... Forex: Dollar falls further against European currencies FOREX: US Dollar starts week strong. EUR/USD falls below 1.3700 Forex - Sterling rebound against dollar falters at 1.5382 |
WORLD FOREX: Euro Falls After Greece Says May Seek IMF Help MarketWatch TOKYO (MarketWatch) -- The euro fell against the dollar and yen in Asia Thursday as news that Greece may seek help from the International ... |
WORLD FOREX: Dollar Dips On Profit-Taking After BOJ Easing MarketWatch TOKYO (MarketWatch) -- The dollar fell against the yen in Asia Wednesday as as a widely expected decision by the Bank of Japan to further ... |
 France24 | FOREX: Dollar slides vs Majors. Fed holds interest rate, housing data declines CountingPips AUD/USD Chart – The Australian dollar today surging higher versus the US dollar in forex trading. The AUD/USD rose to its highest level since January 19th ... Forex Market Bell by Ben Bernanke US DOLLAR: NOTHING WRONG WITH BEING PREDICTABLE USD May Fall Further Following Bernanke Testimony |
Forex trends: dollar gains ground touching 2-day high vs euro Ecommerce Journal The dollar that closed Wednesday's New York trading at 1.0543 against the franc and 1.5327 against the pound is presently quoted at 1.0555 and 1.5312, ... Forex: EUR/CHF breaks below 1.4500 to fresh 17 months low Forex - Swissy rises to fresh 6-week high against dollar Forex - Euro plunges to 17-month low vs. Swissy |
 France24 | WORLD FOREX: Dollar Gains Ground After Strong US Retail Sales Wall Street Journal "The data was dollar positive," said Jacob Oubina, a currency strategist at Forex.com in Bedminster, NJ "It's going to raise [US's] first quarter GDP up ... FOREX-Dollar falls vs yen and euro after trade data WORLD FOREX: Dollar At 2-Week High Vs Yen On Asia Stock Rises FOREX-Dollar gains vs yen after US retail sales data |
 The Hindu | FOREX-Yen slips after its post-BOJ surge fails at Y90 Reuters But strong dollar bids near 90.00 yen JPY= saw yen buyers quickly sell it back, while traders reported dollar buying interest near the day's lows from ... Dollar eases in Asia after Japan, US rate decisions Forex - USD/JPY rises after Fed, BOJ rates moves Bank of Japan Minimal Policy Change Fails to Support Yen |
 Business Standard | Rupee falls by 9 paise against USD in early trade Times of India MUMBAI: The Indian rupee depreciated by 9 paise at 45.43 in early trade today as dollar gained overseas. At the Interbank Foreign Exchange (Forex) market, ... Rupee appreciates 24 paise against US dollar Rupee falls by 9 paise/$ in early trade Rupee strengthens on dollar fall, share gains |
