As long as you take the Zero Line into account, the Zero Line represents momentum, a crossover means nothing without that "weight" behind it
Weight is volume?.. I only use MACD on weekly charts, and while the crossover may at times seem weak, on the daily charts, volume can be very high. --- JimmyJam Why not speed up the indicator if it lags?. I kept mine on 12 for the EMA line, and 9 for the MACD signal line.
Weight is just my word for it, pressure, gravity, whatever, as long as the crossover is Zero Line supported it has an infinitely better chance of being a successful signal Speeding it up would take it out of play because it would not be factoring in all the traders that use the default settings, besides it's a lagging indicator and you may as well use a CCI or stochastic if you want speed... but you will lose reliability
I use a combination. MACD, volume, CCI, ADX, and BB's on weekly charts. I think the longer the time frame, the more reliable the signal from the indicator. -- Also, for those that say "Price is all that matters", I have a question for you. Would you buy a home JUST because of where its located?.
I agree but it tends to lag more the longer the time frame, 2 & 10 min have been a real sweet spot for me in the emini's
CCI/ RSI came second in the poll, so maybe someone can answer this question. This is a weekly chart for NVEC. The CCI is giving reading of over 100 in the area I circled indicating that the stock is overbought, but the stock was trading sideways!.. Can someone tell me what this means?
It means that price is significantly over the 14 simple moving average when normalized relative to recent movements. Overbought it not a particularly good way of using CCI ... like any other indicator you can be overbought for significant periods of time. You might be better to use it in a trending manner but in a situation like that show you will still get chopped if you use it without context ... because the market is in congestion. Its actually better to just use the mas and price movements imo.
It doesn't appear to be too bad because your CCI was up and your chart was sideways. At least your chart didn't go down while the CCI was up. Sideways is better than down(if you are long).
Quote from cashmoney69: Also, for those that say "Price is all that matters", I have a question for you. Would you buy a home JUST because of where its located?. _________________________________ For those that say "indicators is all that matters", I have a question for you. Would I use lagging indicators JUST because eSignal offers it?