Reading Assignments: Indicators

TA & Algo Trading Course
#141

What is MACD and how is it used?
The moving average convergence divergence (MACD) is a kind of oscillating indicator. An oscillating indicator is a technical analysis indicator that varies over time within a band (above and below a centerline; the MACD fluctuates above and below zero. It is both a trend-following and momentum indicator. One basic MACD strategy is to look at which side of zero the MACD lines are on in the histogram below the chart. If the MACD lines are above zero for a sustained period of time, the stock is likely trending upwards. Conversely, if the MACD lines are below zero for a sustained period of time, the trend is likely down. Using this strategy, potential buy signals occur when the MACD moves above zero, and potential sell signals when it crosses below zero.

Signal line crossovers can also provide additional buy and sell signals. A MACD has two lines—a fast line and a slow line. A buy signal occurs when the fast line crosses through and above the slow line. A sell signal occurs when the fast line crosses through and below the slow line.

What is the difference between MACD and RSI?
The MACD is primarily used to gauge the strength of stock price movement. …
The RSI (Relative Strength Index) aims to indicate whether a market is considered to be overbought or oversold in relation to recent price levels. One way to interpret the RSI is by viewing the price as “overbought”—and due for a correction—when the indicator in the histogram is above 70, and viewing the price as oversold—and due for a bounce—when the indicator is below 30.

In a strong uptrend, the price will often reach 70 and beyond for sustained periods of time. For downtrends, the price can stay at 30 or below for a long time. While general overbought and oversold levels can be accurate occasionally, they may not provide the most timely signals for trend traders.

What is OBV and how is it used?
The on-balance volume (OBV) takes a significant amount of volume information and compiles it into a single one-line indicator. The indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days.

#142
  1. MACD moving average con/sivergence: indicates a trend in a certain timeframe (can be choosen, from only Minutes, to 50, 100, 200-day time-frame) Its smoothing out the chart, with a little delay, and can be updated continuously to give a clearer picture of how a certain stock / coin is moving. Cannot be seen as a certain prediction, but merely a probability of what can be expected - supporting one´s investment-strategy (best point for buy / sell - long/short)
  2. RSI relative strength index - different from MACD, it looks at if there is an oversell / overbuy going on, measured in the range from 1-100. Its another method in technical analysis to recognize possible down- or uptrends (below 30, above 70)
  3. OBV on balance volume: looks at the trading volume, difference between the volume at an uptrend, subtracting the volume at a downtrend, a kind of future-indicator:
    OBV rising - price might follow and also soon rise / OBV flat or already falling - a peak of price might have been reached / OBV falling / flat and slightly rising: near the bottom
    Its yet another method to look for buy & sell-signals
#143

  1. What is MACD and how is it used?
    Moving Average Convergence/Divergence is an indicator of trend and reversals and used to also confirm key levels of price.

  2. What is the difference between MACD and RSI?
    RSI indicates overbought and oversold conditions at 20% and 80% ranges, the MACD indicates strength and trend, however the two will compliment each other.

  3. What is OBV and how is it used?
    On Balance Volume to indicate the flow of volume to reflect buying and selling pressures against the price action.

#144
  1. What is MACD and how is it used?

MACD = moving average convergence/divergence and consists of a fast and a slow moving average (diff. time periods), and a histogram is plotted to represent the space between them.

Can mainly be used in 2 ways, i) to see if the histogram is above/below zero line for some time and thereby see if the stock is trending up/down. ii) when the MACD’s two signal lines crosses each other, they can be used as buy/sell signals. Histogram in these cases ~0.

  1. What is the difference between MACD and RSI?

RSI= relative strength index is an oscillating indicator which moves between 0 and 100 and show if the stock is overbought or oversold.

It’s often considered overbought when it reaches 70 in an uptrend (and may be due for a correction), and oversold when reaches 30 in a downtrend. Can be used as a buy signal if the price goes down to 50 in an uptrend and you can sell again when close to 70. (This can represent a pullback). Opposite in downtrend. Difference, see above.

  1. What is OBV and how is it used?

OBV = On balanced volume, adds the volume on up days and divide it by down days to measure the cumulative buying and selling pressure and represent this in a single line indicator. Line points up in uptrends and opposite in downtrends.

If OBV is rising and price isn’t, price will probably soon follow the OBV. If the price is rising and OBV is flat or falling, the price may be near a top. If price is falling and OBV is flat or rising, price could be nearing a bottom.

1 Like
#145
  1. What is MACD and how is it used?

MACD stands for moving average convergence divergence. It a kind of oscillating indicator that fluctuates above and below zero. if the MACD lines are above zero for a sustained amount of time the stock is likely trending upwards. If the MACD lines are below zero the trend is likely downward. A MACD has two lines a fast line and a slow line. A buy signal occurs when the fast line crosses through and above the slow line. a sell signal occurs when the fast line crosses through and below the slow line.

  1. What is the difference between MACD and RSI?

The relative strength index (RSI) is also an oscillating indicator but its movement is contained between zero and 100 so it provides different infomation to the MACD. The RSI can be interpreted by viewing the price as overbought and due for a correction when the indicator in the histogram is above 70 and viewed as oversold and due a bounce when below 30.

  1. What is OBV and how is it used?

OBV stands for on balance volume. The indicator measures cumulative buying and selling pressure in a single line rather than a candle. Ideally the volume should confirm trends. A rising price should be accompanied by a rising OBV, a falling price should be accompanied by a falling OBV.

#146 
1. What is MACD and how is it used?

MACD is an oscillating indicator that varies over time within a band fluctuating above and below zero. If the MACD lines are above zero for a sustained period of time, the stock is likely trending upwards and if the MACD lines are below zero for a sustained period of time, the trend is likely down. It is both a trend-following and momentum indicator.

2. What is the difference between MACD and RSI?

RSI is also an oscillating indicator as MACD but its movement is contained between zero and 100 providing different information. It measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock. In a strong uptrend, the price will often reach 70 and beyond for sustained periods of time, meaning an overbought condition. For downtrends, the price can stay at 30 or below for a long time, meaning an oversold condition.

3. What is OBV and how is it used?

OBV is an indicator that measures cumulative buying and selling pressure by taking a significant amount of volume information and compiling it into a single one-line indicator. The indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days. A rising price should be accompanied by a rising OBV and a falling price should be accompanied by a falling OBV.

#147
  1. The moving average convergence divergence (MACD) is a kind of oscillating indicator. An oscillating indicator is a technical analysis indicator that varies over time within a band (above and below a centerline; the MACD fluctuates above and below zero. It is both a trend-following and momentum indicator.

One basic MACD strategy is to look at which side of zero the MACD lines are on in the histogram below the chart. If the MACD lines are above zero for a sustained period of time, the stock is likely trending upwards. Conversely, if the MACD lines are below zero for a sustained period of time, the trend is likely down.ďťż Using this strategy, potential buy signals occur when the MACD moves above zero, and potential sell signals when it crosses below zero.

Crossovers can also provide additional buy and sell signals. A MACD has two lines—a fast line (50 dma) and a slow line(200 dma). A buy signal occurs when the fast line crosses through and above the slow line. A sell signal occurs when the fast line crosses through and below the slow line.

  1. The relative strength index RSI is another oscillating indicator but its movement is contained between zero and 100 so it provides different information than the MACD.

One way to interpret the RSI is by viewing the price as “overbought”—and due for a correction
when the indicator in the histogram is above 70, and viewing the price as “oversold”—and due for a bounce—when the indicator is below 30.

  1. On-balance volume OBV takes a significant amount of volume information and compiles it into a single one-line indicator. The indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days. Ideally, the volume should confirm trends. A rising price should be accompanied by a rising OBV; a falling price should be accompanied by a falling OBV. If OBV is rising and the price isn’t, it’s likely that the price will follow the OBV in the future and start rising. If the price is rising and OBV is flat-lining or falling, the price may be near a top. If the price is falling and OBV is flat-lining or rising, the price could be nearing a bottom.
#148

  1. The MACD is a Moving Average Convergence Divergence. Its a kind of oscillating indicator that has a baseline 0 that moving average bands are either above or below indicating the current trend.

  2. The are both oscillating indicators however the RSI however it does not go below zero. Its target lines tend to be 70 and 30 indicating overbought and undersold levels.

  3. On Balance Volume takes a significant amount of volume information and compiles it into a sing one line indicator. OBV measuring volume should be a good indicator of the current trend.

#149

  • What is MACD and how is it used?
    A: The moving average convergence divergence (MACD) is both a trend-following and momentum indicator.
    -One basic MACD strategy is to look at which side of zero the MACD lines are on in the histogram; potential buy signals occur when the MACD moves above zero, and potential sell signals occur when it crosses below zero.
    -Signal line crossovers can also provide additional buy and sell signals.
    A buy signal occurs when the fast line crosses through and above the slow line. A sell signal occurs when the fast line crosses through and below the slow line.

  • What is the difference between MACD and RSI?
    A: MACD indicates the overall trend and momentum of the market (and possible reversals) while RSI indicates whether the market is potentially overbought or oversold.

  • What is OBV and how is it used?
    A: On-balance volume (OBV) takes a significant amount of volume information and compiles it into a single one-line indicator. OBV measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days.
    Ideally, the volume should confirm trends - a rising price should be accompanied by a rising OBV while a falling price should be accompanied by a falling OBV.

#150

1.MACD is an oscillating indicator that fluctuates over time above and below the zero line. I would use it with the signal line crossover method to buy and sell.

2.MACD is both a trend following and a momentum indicator and RSI is a relative strength index of whether the item is under or over sold.

  1. OBV is a volume indicator. it is used to confirm trends. personally I prefer moving averages.
#151

  1. What is MACD and how is it used?
    MACD is an oscillating indicator is a technical analysis indicator that varies over time within a band line. We will usually see the price to be trending upwards when MACD line are above zero for a sustained period of time. If MACD lines are below zero for a period of time, the price trend is likely down.

  2. What is the difference between MACD and RSI?
    MACD look at which side of the zero is the line on while RSI look at the indicator. In RSI, we can determine whether a coin/stock is overbought (indicator above 70) and oversold (indicator below 30).

  3. What is OBV and how is it used?
    OBV takes a significant amount of volume information and compiles it into a single one-line indicator. The indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days. A rising price should be accompanied by a rising OBV; a falling price should be accompanied by a falling OBV.

1 Like
#152

Reading Assignments: Indicators

1.What is MACD and how is it used?

MACD is a trend following momentum indicator, and it holds several indicators (two moving average one short and one long, and a convergence/divergence indicator) combined in a sort of package called MACD. The indicator are in almost all chart programs able for you to select and insert in your free tradningview chart.

It’s manly used to spot a trend to try to detect sell or buy signals by the CD (convergence/divergence) indicator wish is calculated by subtraction the long EMA from the short EMA to get a line over or under the zero line, where over the zero line indicate a buy and under a sell.

2.What is the difference between MACD and RSI?

MACD calculates the relation between two exponential moving average, while the RSI calculates price change in relation to recent prices (high and low prices) to get the momentum in this way so the RSI show when a asset is ower

3.What is OBV and how is it used?

The On-balance Volume indicator indicate momentum by calculation of volume(total asset trading volume) whether the volume flowing in or out of the current asset traded, this to make predictions of the interest for the asset.

#153

  1. moving average convergence divergence- is an oscillating indicator, which is used to see if the moving averages of two different time frames or crossing each other. When the shorter time moving average crosses upwards it indicates an uptrend the opposite indicates a downtrend.

  2. MACD is used to indicate whether we are in an up or downtrend. RSI is used to indicate wether an asset is overbought or oversold within a trend.

  3. On-balance volume- It is a tool used to indicate when we are near the top or bottom of a trend. When the OBV is starting to flatten in a upward trend it indicates we are near the top of the trend. the opposite indicates the bottom.

1 Like
#154

  1. The moving average convergence divergence (MACD) is a kind of oscillating indicator that can help traders quickly spot increasing short-term momentum. One basic MACD strategy is to look at which side of zero the MACD lines are on in the histogram below the chart. If the MACD lines are above zero for a sustained period of time, the stock is likely trending upwards. Conversely, if the MACD lines are below zero for a sustained period of time, the trend is likely down. Using this strategy, potential buy signals occur when the MACD moves above zero, and potential sell signals when it crosses below zero.

  2. MACD is used to indicate the trend and strength of the market. RSI is used to identify overbought/oversold conditions.

  3. The on-balance volume (OBV) indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on "down“ days.

#155

MACD (moving average convergence divergence) is an oscillating indicator that varies over time in a band above and below zero. MACD is used to determine short time trends, spot buy and sell signals.

MACD has two lines (fast and slow) oscillating above and below zero used to spot increasing short-term momentum. RSI (relative strength index) has one oscillating line between zero and 100 showing if the market is overbought and oversold , also it can indicate when a pullback has occurred.

OBV ( on balance volume) is indicating volume information using one line indicator and can be used to determine trends.

1 Like
#156

Answers:

  1. MACD is known as moving average convergence divergence. It is to illustrate the moving average price of a chart allowing traders to spot a trend and hopefully to have an indication whether is it towards a more bullish or bearish trend allowing them to take the next necessary action.

  2. While MACD is used to gauge the price movement, RSI (Relative Strength Index) aims to indicate a market whether it is oversold or overbought in relation to the price level. These two indicators are often used together to provide analysts a more complete technical picture of a market.

  3. On Balance Volume (OBV) measures buying and selling pressure as a cumulative indicator that adds volume on up days and subtracts volume on down days. When the security closes higher than the previous close, all of the day’s volume is considered up-volume. When the security closes lower than the previous close, all of the day’s volume is considered down-volume.

#157

1: Moving average convergence divergence it is an indicator that is used to to track momentum and trends

2: RSI can is a single indicator that oscillates between zero and 100 and gives signals are overbought or oversold. MACO uses two indicators that gives signals as line crosses to indicate buy or sell.

3:Measures volume information and compiles it into a single indicator

#158
  1. The MACD is a moving average that acts as a momentum indicator for investors.
  2. RSI gauges magnitude of recent price changes, with the intent to evaluate overbought or oversold assets, and deduce the conditions that led to that behavior. RSI measures shorter term price changes while MACD is used to compare the day’s price with previous prices.
  3. The OBV compiles a number of factors to come up with metrics that indicate buy and sell pressure, and traders often use this to predict price trends, which often correlate with the volume of purchases and sales. Upward volume trends often indicate coming rises in price, and the opposite is true with falling volumes. Flat-lining volumes can serve as early indicators in shifting prices.
#159

The MACD is an lagging oscillating indicator. It stands for moving average convergence divergence. Basically its a histogram plotted on a zero line with two moving averages shown as lines. One line is a shorter time frame, while the other is a longer one, thus a fast line and a slow line. The MACD IS USED IN A FEW DIFFERENT WAYS. fIRST AND FOREMOST, THE ZERO LINE IS A BASE LINE . When the preice action lines move above or below the zero line, it can indicate a change in trend. Since the MACD is a trend following momentum indicator, one can also use the crossovers of the moving average lines to indicate a shift in momentum .
The RSI, or relative strength index is also a trend following momentum indicator however it measure something quite different. Essentially the RSI measures the strength or magnitude of recent price changes. It can be used in conjunction with trend lines, and can also provide signals as to when an asset may be “overbought” or “oversold”, indicating that a short term reversal in trend may be about to take place.
Another powerful indicator that trader often use is the OBV, or on balance volume. This indicator measures the cumulative buying or selling pressure by adding up the volume on positive days and subtracting the volume negative days. This indicator can also be used with trend lines to help a trader to spot possible continuations and reversals in the market, and giving signals to help the trader make more mahtematically informed decisions with a higher degree of confidence.
The OBV is used by comparing the trend of the volume to the price action. If the OBV is going up/down and the price action is doing the opposite, it can signal a pullback. If the OBV is flat or tilting opposite current price action while price action is moving up or down, it may indicate a looming top or bottom. Lastly if the trend of OBV is broken and begins to shift in the opposite direction against current price action, it may well be interpreted as an incoming reversal.

#160

1. What is MACD and how is it used?

The moving average convergence divergence (MACD) is a kind of oscillating indicator that can help traders quickly spot increasing short-term momentum.

2. What is the difference between MACD and RSI?

The MACD is an oscillating indicator that fluctuates above and below zero.

RSI is another oscillating indicator with movement between zero and 100.

3. What is OBV and how is it used?

The on-balance volume (OBV) indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days.

This indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days.

1 Like