What’s MACD?
Moving Average Convergence Divergence (MACD) is a trend-following momentum indicator that shows the relationship between two moving averages of an asset's price. The MACD is calculated by subtracting the shorter-period Exponential Moving Average (EMA) (known as slow MCAD) from the longer-period EMA (known as fast MACD).
The result of that calculation is the MACD line. An x-day EMA of the MACD called the "signal line," is then plotted on top of the MACD line, which can function as a trigger for buy and sell signals. Traders may buy the security when the MACD crosses above its signal line and sell - or short - the security when the MACD crosses below the signal line.
- MACD Line: (shorter-period EMA - longer-period EMA)
- Signal Line: x-day EMA of MACD Line
- MACD Histogram: MACD Line - Signal Line
Strategy:
Buy/Long signal: MACD line crosses above the Signal Line
Sell/Short Signal: MACD line crosses below the Signal Line
On Bibox Trading platform, you can customize your MACD strategy by inputting the following:
- Faster MACD value;
- Shorter MACD value
- Signal Line value
- Number of desired orders
- Time range per candle stick
Here is an example of BTC/USDT trading pair:
Input:
- 18-day EMA
- 31-day EMA
- Signal Line: 19-day EMA
- Desired orders: 10
- 30min candlestick
Analysis:
Long/Buy at 8967 USD
Close position at 9100 USD
Cost = 8967*0.01*100/5=1793.4 USD (5x leverage)
Profit = (9100-8967)*0.01*100= 133 USD
ROI = 133/ 1793.4*100%=7.42% (exclude trading fee, commission, etc)
Annualized ROI = 7.42%/17*24*365=3824%
3824% annualized ROI. Not Bad!
Links：
Moving Average Convergence Divergence – MACD
MACD ( Moving Average Convergence/Divergence Oscillator) n.d.
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You can also contact Bibox telegram admin (@bibox_cs) or join the Telegram group （https://t.me/bibox_trading_bot） for more details.
