Based on signals, generated by the MACD oscillator, Bitcoin (BTC/USD) is currently in an UPTREND mode. The active signal is BUY.
At its core, MACD is a very powerful indicator, and provides good forecasting accuracy if used accurately.
In this Trade Idea I'd like to discuss the mechanics of the MACD and how it applies to the current situation on BTC/USD. Continue reading, and you’ll get the best-in-industry knowledge from an experienced trader, condensed just in the one-page analysis!
The mechanics of the MACD indicator in plain English
The MACD stands for the moving-average convergence/divergence oscillator. It is constructed by two lines, the MACD line and the signal line:
The MACD line is the difference between two exponentially smoothed moving averages (EMAs) with fast and slow periods. We apply 7 and 30 days as inputs.
The Signal line is simply an EMA of MACD line. We apply the 5-days EMA.
The indicator oscillates around zero and has no upper or lower limit.
Traders use the MACD in technical analysis in three ways:
1. By analyzing the crossovers of the MACD line and the signal line
2. By analyzing whether the MACD is outside its normal range
3. By using trend lines on the MACD itself (convergence/divergence).
Interpretation of the current Bitcoin trend using the MACD oscillator
Let’s review each of these signals in application to the current Bitcoin trend.
1. The MACD line is significantly above zero and is moving up. This is a storing signal indicating that BTC/USD is in an UPTREND. Mathematically, it results from the fast EMA moving above the slow EMA. Practically, it means that the Bitcoin’s short-term trend is upwards and is accelerating, as compared to the long-term price trend.
2. We can see that on Mar 21 the MACD line has crossed over the Signal line from above to below it, which was the result of Bitcoin’s unexpected price decline on that day. Although it indicates that an uptrend has decelerated, as compared to the previous week’s dynamics, it still does not indicate a trend reversal. We should interpret this market dynamics as a normal volatility, but not as a change in trend.
3. There are no trend lines on the MACD itself, which would indicate a convergence or a divergence with the price. This further confirms that the current trend up is valid, and you should continue holding your open long position in BTC/USD.
If you like this analysis and would like to receive similar ideals in the future - Please, follow me on TradingView!
This will allow you to stay on top of the current Bitcoin trend and maximize your profits!
If you agree, please, Like this Idea - This would be the best feedback and encouragement for me!
To your trading success,
Monfex!
Disclaimer
This report is for information purposes only and should not be considered a solicitation to buy or sell any cryptocurrency or cryptocurrency product. Monfex accepts no responsibility for any consequences resulting from the use of this material. No representation or warranty is given as to the accuracy, timeliness, or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.
© 2019 Monfex. All Rights Reserved.
At its core, MACD is a very powerful indicator, and provides good forecasting accuracy if used accurately.
In this Trade Idea I'd like to discuss the mechanics of the MACD and how it applies to the current situation on BTC/USD. Continue reading, and you’ll get the best-in-industry knowledge from an experienced trader, condensed just in the one-page analysis!
The mechanics of the MACD indicator in plain English
The MACD stands for the moving-average convergence/divergence oscillator. It is constructed by two lines, the MACD line and the signal line:
The MACD line is the difference between two exponentially smoothed moving averages (EMAs) with fast and slow periods. We apply 7 and 30 days as inputs.
The Signal line is simply an EMA of MACD line. We apply the 5-days EMA.
The indicator oscillates around zero and has no upper or lower limit.
Traders use the MACD in technical analysis in three ways:
1. By analyzing the crossovers of the MACD line and the signal line
2. By analyzing whether the MACD is outside its normal range
3. By using trend lines on the MACD itself (convergence/divergence).
Interpretation of the current Bitcoin trend using the MACD oscillator
Let’s review each of these signals in application to the current Bitcoin trend.
1. The MACD line is significantly above zero and is moving up. This is a storing signal indicating that BTC/USD is in an UPTREND. Mathematically, it results from the fast EMA moving above the slow EMA. Practically, it means that the Bitcoin’s short-term trend is upwards and is accelerating, as compared to the long-term price trend.
2. We can see that on Mar 21 the MACD line has crossed over the Signal line from above to below it, which was the result of Bitcoin’s unexpected price decline on that day. Although it indicates that an uptrend has decelerated, as compared to the previous week’s dynamics, it still does not indicate a trend reversal. We should interpret this market dynamics as a normal volatility, but not as a change in trend.
3. There are no trend lines on the MACD itself, which would indicate a convergence or a divergence with the price. This further confirms that the current trend up is valid, and you should continue holding your open long position in BTC/USD.
If you like this analysis and would like to receive similar ideals in the future - Please, follow me on TradingView!
This will allow you to stay on top of the current Bitcoin trend and maximize your profits!
If you agree, please, Like this Idea - This would be the best feedback and encouragement for me!
To your trading success,
Monfex!
Disclaimer
This report is for information purposes only and should not be considered a solicitation to buy or sell any cryptocurrency or cryptocurrency product. Monfex accepts no responsibility for any consequences resulting from the use of this material. No representation or warranty is given as to the accuracy, timeliness, or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.
© 2019 Monfex. All Rights Reserved.
交易结束：到达目标:
Take-Profit reached!
