Multi-year Bull and Bear Market Trends, using monthly MACD
I noticed that the past two peaks have been signaled by monthly MACD values. Here is the logic:
If Signal > 0:
If MACD > Signal: Then BUY
If MACD < Signal: Then SELL
If Signal < 0: Then BUY
This algorithm has only given 3 SELL signals in the past 20 years. Keep in mind that this SELL signal was more common in previous decades (1960's = 5, 1970's = 3, 1980's = 3). While a couple of these were great trades (SELL @ Jun 1969 and June 1973) most of these trades were small losses, and some were terrible trades (SELL @ November 1987). This system is not perfect and it may make wrong decisions.
The most recent SELL signal was generated on July 1st, 2015.
BUY signals can be generated when the MACD rises above the Signal, but they also occur when the Signal values crosses down across the zero line. The past two market bottoms have been predicted by the signal line crossing zero.
If Signal > 0:
If MACD > Signal: Then BUY
If MACD < Signal: Then SELL
If Signal < 0: Then BUY
This algorithm has only given 3 SELL signals in the past 20 years. Keep in mind that this SELL signal was more common in previous decades (1960's = 5, 1970's = 3, 1980's = 3). While a couple of these were great trades (SELL @ Jun 1969 and June 1973) most of these trades were small losses, and some were terrible trades (SELL @ November 1987). This system is not perfect and it may make wrong decisions.
The most recent SELL signal was generated on July 1st, 2015.
BUY signals can be generated when the MACD rises above the Signal, but they also occur when the Signal values crosses down across the zero line. The past two market bottoms have been predicted by the signal line crossing zero.
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