The MACD indicator plays a particularly special role in technical analysis and can be said to be an essential part of learning technical analysis. Its importance can be summarized in the following points.
1. The MACD indicator is the most effective technical indicator tested by historical trends and is also the most widely used indicator.
2. The MACD indicator is derived from the moving average indicator EMA and has a very good application effect in grasping trending markets. Trend investors generally need to refer to this indicator in practice.
3. The MACD indicator's divergence at peaks and troughs is recognized as the best "buy low, sell high" method, and this method is an important tool for the concretization of trend theory and wave theory.
4. Many experienced traders have had this experience: when they first started, they began learning the MACD indicator, then slowly discarded it, and after a long period of study and comparison, especially after testing it in practice, they ultimately returned to the MACD indicator. This shows the special nature of this indicator.
5. The application of the MACD indicator in quantitative trading is also extremely widespread.
Due to these advantages, the MACD indicator has become the most commonly used technical indicator among professional traders.
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