What's MACD Indices Divergence?
MACD Divergence Indices Trading is one of the indices trading strategy used by online stock indices traders to analyze indices chart stock indices price movement. MACD Indices Divergence involves looking at a stock indices chart & one more stock indices technical indicator - MACD indicator. For our this stock indices trading divergence tutorials we shall use the MACD indicator - MACD Stock Indices Divergence.
To spot this MACD indices divergence trading setup find 2 chart points at which stock indices price makes a new swing high or a new swing low but the MACD indicator does not do the same, thus indicating that there is a divergence between the stock indices price & momentum.
MACD Indices Divergence Example:
In the stock indices chart below we spot two chart points, chart point Marked A and chart point Marked B (swing highs)
Then using MACD indicator we check highs made by MACD indices trading technical indicator, these are highs that are directly below the Chart points marked A & B.
We then draw one line on the stock indices chart & another line on the MACD indicator.
MACD Indices Divergence Meaning - Bullish Indices Trading Divergence MACD - Bearish Indices Trading Divergence MACD - MACD Indices Trading Divergence Guide
How to trade MACD indices divergence
In order to trade MACD indices divergence setup we look for the following set-ups:
HH - Higher High - 2 highs but the last one is higher
LH - Lower High - 2 highs but the last one is lower
HL - Higher Low - two lows but the last one is higher
LL - Lower Low - two lows but the last one is lower
First let us look at examples of these indices trading divergence terms
MACD Divergence Meaning - Stock Indices MACD Divergence Guide
MACD Stock Indices Divergence Definition - MACD Divergence Indices Guide - MACD Indices Divergence Strategy Course - MACD Divergence Indices Trading Tutorial
There are two types of indices trading MACD divergence setups:
- MACD Classic Divergence
- MACD Hidden Divergence
