Moving Average Convergence Divergence(MACD).

In a volatile and dynamic market like the forex everyone would require “a set of precise recommendations” or in other words accurate forex signals for successful trading.

Moving Average Convergence Divergence or MACD is a detailed method of technical analysis using moving averages for forex trading. Trading signals can be generated from price charts with the help of MACD

When the MACD crosses below this trigger it is a bearish signal and when it crosses above it, it's a bullish signal, with the corresponding implications for the currency's price in each particular situation.

Moving averages tell the average price in a given point of time over a defined period of time. These are known as ‘moving’ because they reflect the latest average, while adhering to the same time measure. To resolve the inconsistency between entry and exit, a forex trader can use the MACD histogram for both trade-entry and trade-exit signals.

MACD can also be used by combining two averages of distinct time-frames. Whether using 5 and 20-day MA, or 40 and 150-day MA, buy signals are usually detected when the shorter-term average crosses above the longer-term average and the price is likely to go up.

Conversely, if the shorter average falls below the longer one, sell signals are suggested as the price is likely to go down.