Question: Using the Moving Average Convergence Divergence (MACD) trading rule, we can generate a trading signal. Choose the response which best describes this procedure. If the

Using the Moving Average Convergence Divergence (MACD) trading rule, we can generate a trading signal. Choose the response which best describes this procedure.

  1. If the difference (Fast MA Slow MA) crosses from below the Slow MA, then buy. If the difference (Fast MA Slow MA) crosses from above the Slow MA, then exit or stay out.
  2. If the Fast MA of the difference (Fast MA Slow MA) crosses from above the Slow MA of the difference (Fast MA Slow MA), then buy. If the Fast MA of the difference (Fast MA Slow MA) crosses from below the Slow MA of the difference (Fast MA Slow MA), then exit or stay out.
  3. If the difference (Fast MA Slow MA) crosses from below its own MA, then buy. If the difference (Fast MA Slow MA) crosses from above its own MA, then exit or stay out.
  4. If the difference (Fast MA Slow MA) crosses from below the Fast MA, then buy. If the difference (Fast MA Slow MA) crosses from above the Fast MA, then exit or stay out.
  5. If the Fast MA of the difference (Fast MA Slow MA) crosses from below the Slow MA of the difference (Fast MA Slow MA), then buy. If the Fast MA of the difference (Fast MA Slow MA) crosses from above the Slow MA of the difference (Fast MA Slow MA), then exit or stay out.

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