Home The Technical Indicator Series
MACD for Beginners
Understanding the Most Popular Momentum Indicator in Trading
Most traders learned MACD by memorizing its signals. Then they wondered why the signals kept failing them.
This book starts where the indicator started: with the problem Gerald Appel set out to solve in the late 1970s. From there it builds MACD piece by piece, from its three components to the signals they produce, so that every signal makes sense instead of needing to be memorized.
What sets it apart is what it doesn't hide. You'll see MACD working cleanly on a trending S&P 500, and you'll see it give a false signal in the middle of the 2008 financial crisis, along with the warning signs that were there to be read. The charts are drawn from real market history, including the 2007 top, the March 2009 bottom, and the 2020 COVID crash.
It finishes with the part that decides whether any of this pays: a complete risk-management framework that keeps you in the game long enough to benefit from what you've learned.
Inside the book
- The three components of MACD and what each one measures
- Signal-line crossovers, zero-line crossovers, and divergence in plain English
- How to judge signal quality, not just whether a signal appeared
- Why MACD fails in sideways markets, and how to recognize one
- Choosing timeframes, from weekly context to daily execution
- Stop-losses, position sizing, and the fixed-percentage rule
- A glossary and a quick-reference cheat sheet
11 chapters, 33 original chart illustrations.
Look inside
A few pages from the paperback. Select a page to see it full size.
- The contents
- The opening of Chapter 1
- Reading MACD on a chart
- The strength of a crossover
Who it's for
Anyone who has MACD on a chart and isn't sure what it is actually saying.
