this question is for senios here but I would like to answer this
One of the beneficial aspects of the MACD is also one of its drawbacks. Moving averages, be they simple, exponential or weighted, are lagging indicators. Even though MACD represents the difference between two moving averages, there can still be some lag in the indicator itself.
A nine-day EMA of the MACD, called the "signal line", is then plotted on top of the MACD, functioning as a trigger for buy and sell signals.
As you can understand you are using derivative of the derivative of price as a trigger line.
This is the problem with almost all the indicators, they are derived from price or volume or combnation of both which obviously lagging in nature.
One of the beneficial aspects of the MACD is also one of its drawbacks. Moving averages, be they simple, exponential or weighted, are lagging indicators. Even though MACD represents the difference between two moving averages, there can still be some lag in the indicator itself.
A nine-day EMA of the MACD, called the "signal line", is then plotted on top of the MACD, functioning as a trigger for buy and sell signals.
As you can understand you are using derivative of the derivative of price as a trigger line.
This is the problem with almost all the indicators, they are derived from price or volume or combnation of both which obviously lagging in nature.
... not by experience or age ...
