What is MACD?MACD is a technical analysis used to measure the short term momentum of a stock. Let us look at how it works. When a MACD rolls to the bottom on a chart it is in a bearish trend. When the MACD on a chart rolls over to the top then it is a bullish trend. When we use this as a trading signal for the stock below, we enter the stock when the MACD rolls over to the top. The stock is at $13.50. We exit the trade when the MACD rolls over to the bottom. The stock is at $16.50.
In our example we made $3 or 23% in 3 months. You may want to look into this as a possible trading technique. Or at least it will help you read the stock. Be sure to always paper trade before putting any real money into the market. Only enter when you feel you can make money in the market.
 
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