Introduction: In trading, MACD is a very popular technical indicator that helps us identify trends and determine buy and sell signals. However, not all indicators are suitable for combining with MACD. Today we will explore those indicators that are not suitable for pairing with MACD.
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1. MACD and moving averages are overly repetitive
MACD itself is an indicator evolved from moving averages, so when combined with ordinary simple or exponential moving averages, it may lead to information redundancy, losing the advantages of indicator combinations.
2. Stochastic Oscillator
Both the Stochastic Oscillator and MACD are used to measure market momentum. The combination of the two may lead to the repeated appearance of similar signals, failing to provide effective confirmation.
3. RSI (Relative Strength Index)
RSI is also a momentum indicator, and its combination with MACD may lead to overly complex interpretations. Both MACD and RSI excel at detecting changes in market momentum, so confusing signals can easily arise.
4. Bollinger Bands
Bollinger Bands are more for observing price fluctuation areas. When combined with MACD, due to the focus on different aspects of information, it may be difficult to provide clear trading decisions.
Summary: Choosing the right combination of indicators is crucial for trading decisions. When selecting indicators to combine with MACD, we should not repeatedly use the same type of momentum indicators but rather seek new perspective indicators that can complement MACD's shortcomings for a more complete market analysis view.
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