The vast vast majority of people use it to try and call reversals. And thousands of man hours have been wasted creating blogs and videos showing you how to win with it instead of showing you indicators that actually work for the forex market. First off know the macd indicator was created in the 1970s for stock trading.
As the oscillator in calculation the base line of macd is used for smoothing its signal line is used. The osma indicator is continuation of classical macd here more using indicators and is constructed on the basis of a ratio of two moving averages. The main reasons that a properly researched trading strategy helps are its verifiability quantifiability consistency and objectivity.
Forex macd osma indicator in forex a trading strategy is a fixed plan that is designed to achieve a profitable return by going long or short in markets. Once you download and install the indicator it will appear in your trading chart like the image shown above. This indicator works with all currency pairs and all timeframes.
The macd osma indicator is a metatrader 4 mt4 indicator that can be used with any forex trading system for extra confirmation to enter or exit a trade. This means that it is a lagging indicator. One of the flaws of the osma indicator stems from its inherently heavy use of moving averages similar to the macd.
If the osma indicator stops decreasing and instead starts to increase in value it is more advantageous to be long rather than short. Osma is used in technical analysis to represent the variance between an oscillator from its moving average over a given period of time. An abbreviation for oscillator moving average.
