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Random article: Forex MACD Indicator
MACD (moving average convergence/divergence) is a well-know technical indicator based on relation of two moving averages (MA) of price. This indicator is related to both trend indicators and oscillators. Notwithstanding it was first reported by Gerald Appel as early as in the end on 1970-s, this indicator is still popular today. Let's figure out why it gained popularity among traders, which useful information it provides and what are its pros and cons. Two types of MACD are distinguished: linear and bar chart. Let's consider each of them separately.
In measurement formula for Joe Granville indicator, close prices compared with the purpose of adding or deducting of volume, whereas Williams' indicator open and close prices are compared. Marc Chaikin compares close prices with the middle of range from minimum to maximum. The history of indicator is interesting on its own. In Larry Williams formula, Chaikin substituted open price for price of range. The reason of change was not that he considered it wrong, but that he was not able to find data on prices of opening. That time prices were taken from daily papers, which, due to some reason, stopped publishing prices of opening.
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