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Overview
The MACD ("Moving Average Convergence/Divergence") is a trend following momentum indicator that shows the relationship between two moving averages of prices. The MACD was developed by Gerald Appel, publisher of Systems and Forecasts.
The MACD is the difference between a 26-day and 12-day exponential moving average. A 9-day exponential moving average, called the "signal" (or "trigger") line is plotted on top of the MACD to show buy/sell opportunities. (Appel specifies exponential moving averages as percentages. Thus, he refers to these three moving averages as 7.5%, 15%, and 20% respectively.)
Interpretation
The MACD proves most effective in wide-swinging trading markets. There are three popular ways to use the MACD: crossovers, overbought/oversold conditions, and divergences.
Crossover:
The basic MACD trading rule is to sell when the MACD falls below its signal line. Similarly, a buy signal occurs when the MACD rises above its signal line. It is also popular to buy/sell when the MACD goes above/below zero.
Overbought/Oversold Conditions:
The MACD is also useful as an overbought/oversold indicator. When the shorter moving average pulls away dramatically from the longer moving average (i.e., the MACD rises), it is likely that the security price is overextending and will soon return to more realistic levels. MACD overbought and oversold conditions exist vary from security to security.
Divergences:
A indication that an end to the current trend may be near occurs when the MACD diverges from the security. A bearish divergence occurs when the MACD is making new lows while prices fail to reach new lows. A bullish divergence occurs when the MACD is making new highs while prices fail to reach new highs. Both of these divergences are most significant when they occur at relatively overbought/oversold levels.
Calculation
The MACD is calculated by subtracting the value of a 26-day exponential moving average from a 12-day exponential moving average. A 9-day dotted exponential moving average of the MACD (the "signal" line) is then plotted on top of the MACD.
Information was from the eSignal description of MACD, and was derived, Technical Analysis from A to Z by S.B.Achelis
Want to Learn More ❓❓ Get info on My Strategy and Courses here: https://www.warriortrading.com/strategy/ 📈
Before we continue...👀
💰Remember, day trading is risky and most traders lose money. You should never trade with money you can’t afford to lose. Prove profitability in a simulator before trading with real money.
❗❗My results are not typical. We do not track the typical results of past or current customers. As a provider of trading tools and educational courses, we do not have access to the personal trading accounts or brokerage statements of our customers. As a result, we have no reason to believe our customers perform better or worse than traders as a whole.
❌Do not mirror trade me, or anyone else. Mirror trading is extremely risky https://www.warriortrading.com/why-mirror-trading-is-a-bad-idea/.
🍏 All of the content on our channel is for educational purposes only. No data, content, or information provided by Warrior Trading, the Site, or the other products and services of Warrior Trading, is intended, and shall not constitute or be construed as, advice or any recommendation to buy, sell or hold a particular security or pursue any particular investment strategy.
✔️If you don’t agree with those terms and our full disclaimer (https://www.warriortrading.com/disclaimer), you should not continue watching our videos.
Still with me?
Now let’s dig into some helpful information …
What’s my story? ✏️ You can read it here: https://www.warriortrading.com/ross-cameron/
And check out my broker statements here 📝 https://www.warriortrading.com/ross-camerons-verified-day-trading-earnings/
Our website is filled with free info 🔎 Start with this guide, no opt-in required: https://www.warriortrading.com/day-trading/
Wondering what I think the All Star Day Traders out there have in common? 🏆 Read this blog I wrote https://www.warriortrading.com/all-star-traders/
Chapters:
00:00 Introduction
01:38 Focus on trading when there is the most reward potential
02:15 Adding MACD and focusing on Front Side
03:50 A fraction of nothing is...
04:39 Avoid Trades when MACD is BELOW Signal Line
05:00 Standard MACD Settings
06:16 Defining MACD
08:59 Focusing on trading the big momentum zones
10:21 Avoid Trades Below VWAP
13:11 Avoid Stocks with History of False Breakouts
16:21 Don't overtrade past the clean move
21:59 Examples of Avoiding False Breakouts
25:13 Trade the best, leave the rest!
26:06 Focus on 15-20 cents per share per day
#daytrading #warriortrading #rosscameron #stocks #learntotrade
Warrior Trading // Ross Cameron // Day Trade Warrior
Overview
The MACD ("Moving Average Convergence/Divergence") is a trend following momentum indicator that shows the relationship between two moving averages of prices. The MACD was developed by Gerald Appel, publisher of Systems and Forecasts.
The MACD is the difference between a 26-day and 12-day exponential moving average. A 9-day exponential moving average, called the "signal" (or "trigger") line is plotted on top of the MACD to show buy/sell opportunities. (Appel specifies exponential moving averages as percentages. Thus, he refers to these three moving averages as 7.5%, 15%, and 20% respectively.)
Interpretation
The MACD proves most effective in wide-swinging trading markets. There are three popular ways to use the MACD: crossovers, overbought/oversold conditions, and divergences.
Crossover:
The basic MACD trading rule is to sell when the MACD falls below its signal line. Similarly, a buy signal occurs when the MACD rises above its signal line. It is also popular to buy/sell when the MACD goes above/below zero.
Overbought/Oversold Conditions:
The MACD is also useful as an overbought/oversold indicator. When the shorter moving average pulls away dramatically from the longer moving average (i.e., the MACD rises), it is likely that the security price is overextending and will soon return to more realistic levels. MACD overbought and oversold conditions exist vary from security to security.
Divergences:
A indication that an end to the current trend may be near occurs when the MACD diverges from the security. A bearish divergence occurs when the MACD is making new lows while prices fail to reach new lows. A bullish divergence occurs when the MACD is making new highs while prices fail to reach new highs. Both of these divergences are most significant when they occur at relatively overbought/oversold levels.
Calculation
The MACD is calculated by subtracting the value of a 26-day exponential moving average from a 12-day exponential moving average. A 9-day dotted exponential moving average of the MACD (the "signal" line) is then plotted on top of the MACD.
Information was from the eSignal description of MACD, and was derived, Technical Analysis from A to Z by S.B.Achelis
Want to Learn More ❓❓ Get info on My Strategy and Courses here: https://www.warriortrading.com/strategy/ 📈
Before we continue...👀
💰Remember, day trading is risky and most traders lose money. You should never trade with money you can’t afford to lose. Prove profitability in a simulator before trading with real money.
❗❗My results are not typical. We do not track the typical results of past or current customers. As a provider of trading tools and educational courses, we do not have access to the personal trading accounts or brokerage statements of our customers. As a result, we have no reason to believe our customers perform better or worse than traders as a whole.
❌Do not mirror trade me, or anyone else. Mirror trading is extremely risky https://www.warriortrading.com/why-mirror-trading-is-a-bad-idea/.
🍏 All of the content on our channel is for educational purposes only. No data, content, or information provided by Warrior Trading, the Site, or the other products and services of Warrior Trading, is intended, and shall not constitute or be construed as, advice or any recommendation to buy, sell or hold a particular security or pursue any particular investment strategy.
✔️If you don’t agree with those terms and our full disclaimer (https://www.warriortrading.com/disclaimer), you should not continue watching our videos.
Still with me?
Now let’s dig into some helpful information …
What’s my story? ✏️ You can read it here: https://www.warriortrading.com/ross-cameron/
And check out my broker statements here 📝 https://www.warriortrading.com/ross-camerons-verified-day-trading-earnings/
Our website is filled with free info 🔎 Start with this guide, no opt-in required: https://www.warriortrading.com/day-trading/
Wondering what I think the All Star Day Traders out there have in common? 🏆 Read this blog I wrote https://www.warriortrading.com/all-star-traders/
Chapters:
00:00 Introduction
01:38 Focus on trading when there is the most reward potential
02:15 Adding MACD and focusing on Front Side
03:50 A fraction of nothing is...
04:39 Avoid Trades when MACD is BELOW Signal Line
05:00 Standard MACD Settings
06:16 Defining MACD
08:59 Focusing on trading the big momentum zones
10:21 Avoid Trades Below VWAP
13:11 Avoid Stocks with History of False Breakouts
16:21 Don't overtrade past the clean move
21:59 Examples of Avoiding False Breakouts
25:13 Trade the best, leave the rest!
26:06 Focus on 15-20 cents per share per day
#daytrading #warriortrading #rosscameron #stocks #learntotrade
Warrior Trading // Ross Cameron // Day Trade Warrior
👏👏👏👏👏👍👍👍👍👏👏👏👏best
Excellent video Ross! Thanks again.
Ross, you are my go to whenever I find myself making losing trades! Thank You for your knowledge. It has helped me so much!
the period of MACD in your chart seems like 120, because it looks very smooth.
How do you set this up on think or swim. Having trouble getting the macd signal layout that way
Hi Ross – do you short these breakout stocks after they have peaked and are on down trend? I mainly see you going long.
Ross I am new to the game but I have learnt so much..I have been successful in a simulator for a while. May go live in '24
sorry, if I am not wrong from 11 to 12.50 it is about 12% breakout. doesnt really look to me a false breakout in your 1st example. looked like an awesome one
Thanks Ross!
👍Thanks, that's a perennially useful tip about looking for a history of false breakouts. 👍
Are we going to short the month of April?
What is MACDsig?
I appreciate the way you teach about trading. Looking for stock to buy in 2023? GOGY has remarkable record of growth and innovation in the fast-growing energy drink segment. GOGY is primed for long-term success.
Thanks Ross! I’m following and viewing your videos multiple times daily. As a retired Navy Officer I commend you on your professionalism and your strong communication skills. I’m a swing and long trader, but also I’m now interested in “day” after listening and following you. Thanks again for sharing all of your knowledge!!
Thanks ross
Thanks. Much needed info for me.
hello, i know you’re very busy but do you think that this method is also good with NQ or MNQ Futures ? i try to prop firm with Futures . thank
Thanks so much. I have been chasing false breakouts of late, forgetting all of my discipline. Been trying too hard to find good trades in this volatile market
Thank you Ross,
Amazing!
Great Indicator
Can't we just watch lvl 2 for false breakouts?
Is paper money on Think/Swim the same as a simulator?
Great stuff Ross! Thx
Thanks for sharing great refresher . I liked # 2 on false break out history very good point 👍 I alway say if it looks like a porcupine don’t grab it lol👍👍👍. 🥂
Ross I wanted to say what you’re doing is great but more so that your personal communication skills are extraordinary. I know we often don’t hear thanks enough and as a ft trader myself I’m not a instructor of how to’s. In fact I am terrible at it and overly technical.
I refer people to you and your series of videos because I know they will learn and enjoy watching your clarity and enthusiasm. It is magnetic.
For anyone new to trading that is reading Ross really explains properly what you need to do as a new trader.