MACD Histogram -> Distance between Fast and Slow EMA – Fast=12, Slow=26.
If Fast is Above Slow, MACD Histogram is above zero.
If Fast is Below Slow, MACD Histogram is below zero.
Have a look at the example…current trend – as defined by the logic is a downtrend.
We are looking for opportunities – buybacks on downtrend to sell into.
A. Using the MACD histogram as an easy visual representation of the 12/26 moving averages, you can drop a line onto the above and below zero peaks and valleys – finding common turning points.
B. Setting these as equal, for both above and below zero, it would give you 2x values .0002, -.0002 tp plot on your 12/26 MACD.
C. If compared to price, where these peaks and valleys occur, and you checked where the 12 and 26 EMA points were, you could see the value
Setting MACD Points – what is the common/average distance on trend pullbacks in pips/points?
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