Charting - MACD

[geno]

Recently started with OST. I understand a MACD graphs to show two lines and a bar chart that dispays the diff between them. But on OST the bar chart seem to just occupy the space between the zero line and the EMA diff line (ie, the line that shows the diff between the 12 & 26day EMAs) What am I missing, should I be clicking something, or do I understand it wrong? for reference, see http://en.wikipedia.org/wiki/MACD Regards,

[warhippo]

Geno go to: http://www.investopedia.com/university/buildingblocks.asp Hope it is what you are looking for as one question usually leeds to next - good luck!

[geno]

thanks for the link warhippo, but that doesn't answer my question. Generally, a MACD graph shows the following * MACD = EMA[fast,12] - EMA[slow, 26] * signal = EMA[period,9] of MACD * histogram = MACD - signal The chart page on OST doesnt show the histogram. How do I get it to show it? :)

[warhippo]

Apologies - let this sit - I am sure one of the traders here who's in tech anyls. will be able to help you.

[geno]

cool :)

[Rams]

When MACD is above Zero line, the histogram will be above Zero line and Green.When MACD is below Zero line the histogram will be below Zero line and red.No input from user, as it should come up automatically but check with the call centre.Anyway, not much use if you using s signal line with MACD. Also ,I find that the HISTOGRAM has poor predictive value, so I dont use it.

[Ninja]

all the above answers are wrong....how can people trade this indicator if they dont understand it?? If the macd is above the zero line the histo can still be red! Quite simply the histo is red when the macd is below its signal line which is a moving average of the macd. when the macd is above the zero line it means that the 12 period ma is above the 26 period ma and when below zero vice versa. The histo is a momentum change indicator and can change regardless of where the macd is.

[#8]

The MACD's greatest service is that it is good,when applying Positive or Negative Divergence to Price.The Coiled-Spring effect.Otherwise....nah.

[Rams]

Ninja,you or your IG charts are wrong! Read my post again and check with OST charts - green above Zero line and RED below zero line. As a momentum indicator, most useless indicator of all!

[Ninja]

rams...the histo relates to the macd's position relative to its moving average....it has nothing to do with the zero line. Check your charts....you will often have a red histo even when macd is above the zero line....this is because although the macd is above the zero line, it has crossed below its signal line.

[Rams]

Ninja, read my post again, it was a response to the topic posted by GENO regarding the MACD HISTO on OST.GREEN ABOVE ZERO AND RED BELOW ZERO ON OST CHARTS and configured to MACD crossing ZERO line. Even on your IG charts, RED below Zero and Green above.You are correct regarding the signal line but OST charts configures MACD croosing Zero. Some HISTO also have blue....

[Ninja]

no, not on my ig charts....been backtesting all day.....histo on ig as I described. If you talking ost then their set up is a little weird ....that is not my understanding of the macd histo....but to your point you are discussing ost macd so my comments re that i withdraw. I am however trying to tell geno how to look at the macd.....the histo should not refer to the macd crossing the centre line.....that is not the correct calc for the histo. The histo refers to the crossing of the macd and its signal line, regardless of centre line.

[Ninja]

http://stockcharts.com/help/doku.phpid=chart_school:technical_indicators:macd-histogram Follow this link....if ost charts are not plotting the histo correctly i would suggest you find a website that is able to offer you decent charting and that understands how an indicator is built.

[Ninja]

http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:macd-histogram

[Rams]

Somebody ballsd up the 2 simple moving averages by adding a third moving average to the 2 simple moving averages and exponentialling it and callling it the MACD and as if that was not enough, they went and subtracted the difference from the sum of all 3 and called it Histogram which can be configured in 50 different ways and after all of this work, as of the last price on the chart, it still tells you nothing more than the original 2 simple moving averages if not less!

[Ninja]

Rams, have you even read your last post on macd? The macd is one of the most widely used and reliable indicators available to the chartist. Your ramblings here clearly highlight that you have no idea as to how this indicator works, is calculated or interpreted by the accomplished trader, no wonder it doesnt help you with your trading. There are however many technicians out there that can understand how it works and put it to great use. I have a feeling you will never be one of them though.

[geno]

heated debate! let me try again, my question basically asks why OST's histogram does not plot the way that something like Wikipedia or stockcharts.com explains it? On OST the histogram just occupies the space underneath the MACD line. So if the MACD line above zero, then the histogram positive - and vica verca. _BUT_ - when you look at stockcharts, the histogram should be the MACD - SIGNAL line (MACD minus Signal) which is def something different. SO_ I'm not asking how the MACD works, not what the MACD, Signal line or Histogram is or how they are calculated, I AM ASKING WHY OST CHARTS IT INCORRECTLY? OR IF I'm SUPPOSED TO CLICK SOMETHING OR WHAT? [the caps is not meant as a shout, but to pronounce, since bold is not possible :)] related links: Stockcharts.com 's definition of MACD - [ http://bit.ly/fO5DkP ] this shortened url will redirect there

[Rams]

Ninja,you seem to think the reference for an "accomplished trader" has to be yourself.Ha,when you trading 5 min charts for ticks using MACD and a tiny portfolio.Can the Ninja be anywhere close to being "accomplished" when : "The functions of the ninja included espionage, sabotage, infiltration, and assassination, as well as open combat in certain situations. The ninja, using covert methods of waging war, were contrasted with the samurai, who had strict rules about honor and combat"(wikipedia).You want to debate, stick to the topic, you stray, I can stray....