--- title: 'MACD Indicator! The Best Trading Strategy!!!' source: 'https://youtube.com/watch?v=cZVoPwg91fY' video_id: 'cZVoPwg91fY' date: 2026-07-24 duration_sec: 918 channel: 'PROSTOINVEST' --- # MACD Indicator! The Best Trading Strategy!!! > Source: [MACD Indicator! The Best Trading Strategy!!!](https://youtube.com/watch?v=cZVoPwg91fY) ## Summary This video provides a comprehensive analysis of the MACD indicator and a trading strategy based on it, specifically for Bitcoin on the Bybit exchange. The presenter explains the components of MACD, including the MACD line, signal line, histogram, and zero line, and demonstrates how to identify convergence and divergence to find entry points. The strategy involves opening positions when the MACD line crosses the signal line, with the crossing occurring far from the zero line, and using a 1:2 risk-reward ratio. ### Key Points - **Introduction to MACD Strategy** [00:02] — The video promises a free MACD trading strategy for making money, covering the indicator's origin, meaning, accuracy, and potential earnings. - **Setup on Bybit with Bitcoin** [00:55] — The presenter uses the Bybit exchange and TradingView chart, recommending Bitcoin exclusively for trading to avoid losses. - **MACD Indicator Basics** [01:09] — MACD stands for Moving Average Convergence Divergence, invented by Gerald Appel in the 1970s. It is a more accurate version of moving averages, showing the difference between two EMAs. - **Components of MACD** [02:04] — The indicator consists of a blue MACD line, a yellow signal line (EMA of MACD), a histogram showing the difference between the two lines, and a zero line. The histogram bars are colored green when the difference increases and pale green when it decreases; red for increasing difference, pale red for decreasing. - **Zero Line and Trend Direction** [03:28] — When the two EMAs (12 and 26) cross, the MACD lines cross the zero line. Above zero indicates an uptrend, below zero a downtrend. - **Trading Strategy: Crossings** [05:51] — Open a long position when the blue line crosses above the yellow line below zero, far from the histogram. Open a short position when the blue line crosses below the yellow line above zero, far from the histogram. - **Divergence and Convergence** [06:34] — Divergence occurs when price makes higher highs but MACD makes lower highs, signaling a bearish reversal. Convergence occurs when price makes lower lows but MACD makes higher lows, signaling a bullish reversal. - **Backtest Over 3 Months** [08:12] — Using a 4-hour chart, the presenter found 7 positions: 6 profitable (4% each) and 1 loss (-2%), resulting in 22% net profit with 1x leverage. Higher leverage increases risk. - **Risk Management** [13:54] — Use stop-loss and take-profit with a 1:2 risk-reward ratio. Move stop to breakeven after 1-2% profit. Avoid over-leveraging and diversify. ### Conclusion The MACD indicator, when combined with divergence/convergence analysis and proper risk management, can yield consistent profits in Bitcoin trading. The presenter emphasizes using a 1:2 risk-reward ratio and avoiding over-leveraging to manage risk. ## Transcript Invest channel. In this video, I will tell you about the MACD indicator trading strategy. MACD indicator trading strategy. I'll show you for free how to actually make money using this indicator. This will be a complete analysis of the indicator. where it came from, what certain columns and lines mean, what this indicator points to, how accurate it is, and most importantly, how much you can earn with it if you use it correctly . Well then, sit back and relax , we're getting started. this video and subscribe to the channel, because the information here will be really useful. I will show everything on the Bybit exchange, but you can use another exchange or just use the chart, for example, on Trading View. This means we include the Trading View chart on the trading pages. We choose Bitcoin as the coin. I don't recommend trading other coins, but if you don't want to trade at a loss, I recommend trading exclusively on Bitcoin. Next you need to open the MCDM indicator. Click on the indicators and either type them in the search or select them from the list. Click here. In our region it is often called MAGD, but the correct pronunciation in English is MACD, Moving Average, Convergence Divergence. I don't care at all what they call him. The main thing for us is that it works. It was invented by Jarld Appel in the seventies of the last century, then still for the stock market, and with the advent of the crypto market, it was transferred here, however, like absolutely everything else. Now let's talk more about the indicator itself. In itself, it is a more accurate and complex moving average indicator. Moving averages are separate indicators. We won't go into detail about them, but in short, we can say that they sort of average the price over a certain period of time so that we can see the overall market movement. Well, MACD does this much more accurately, because it also shows the difference between these moving averages. Let's take a closer look at it. We see two lines here: the blue MACD line and the yellow EMA line. Also, these columns, which are called a histogram, show us how big the discrepancy is between these two lines. And finally, here is this graph with points and a zero mark in the middle. For now, let's look at the lines themselves separately. The meaning of these lines can be seen here above. The yellow numbers are the value of the yellow line. Here they are in points. Blue numbers are the meaning of the blue line. And these green numbers are the difference between the blue and yellow lines. On the graph, this is the difference between them. That is, if you subtract this from this number , you get this number. And this is exactly the number that the histogram shows. These are the columns. Visually, this can be shown like this. This column is the difference, that is, the distance at this moment between the two lines. The next column is the difference at this point. And as you can see, the lines start to get closer together and the columns also start to get smaller. It also shows that if the next bar is larger than the previous one, it is colored green, meaning the difference between the two lines has increased. If the column is pale green, it means the difference between the two lines has decreased. The same principle applies to the red bars. The difference grows - red, the difference decreases, pale red or pink, it doesn’t matter. Next. The zero line is a representation of the difference between the two EMA lines. By the difference between the two EMA lines. By default these are EMA12 and EMA26. average that is calculated based on the closing price over a specified period of time. For example, like we have 12 or 26 candles. Everything is shown here by default, but let me turn them on in the graph so you can better understand what I'm talking about. When these two lines intersect, or in other words coincide, this will be the zero point, that is, a possible change in trend. You see, if the white line is below the purple line, in our MACD indicator, our two lines will be below zero. The trend is downward. If the white line on the chart crosses the purple line, it will be zero. And if it goes further and becomes higher than purple, in MCD we see that our two lines will already go above zero, the trend is upward. That is, in this way we determine that the market is turning around and a new trend is beginning. Well, since everything is clear in our MICD , above zero the trend is upward, below zero the trend is downward. We don't need these two lines on the chart, we'll remove them. And since our indicator remove them. And since our indicator shows the inscription MACD 1226 Close translated as closing, we understand that the blue line is the derivative of these two indicators at the moment of closing of the candle. That is, it is a slightly more complicated or average. There is a formula by which all this is calculated. Well, since you are unlikely to ever need it, we will not focus on it. But the yellow line, the so-called signal line, also known as 9, is calculated from the blue MAGD line and is needed to show the difference in the trend momentum. In simple terms, it sounds like this. The blue line is harder and sharper, it reacts more strongly to price movements, and the yellow line is softer and calmer. It turns out that the blue line will always cross the intersections will play a key role for us. They indicate when it is best to open a position. And the further these lines intersect from the center, from zero, the more accurate the signal will be. I would also like to add that the indicator has settings, and you can customize its value, from color to indicators, but I always use it by default, that is, as it is here. Well, since we have analyzed the operating principle, we move on to the most interesting part, namely the trading strategy. Our strategy is to open a position when the blue line crosses the yellow line. If we want to open a bullish position, then these two lines must be below zero. And not just below, but as far from the histogram as possible. That is, if you go up when it crosses somewhere at the histogram level, or above zero, nothing will work. The same applies to a bearish position, that is, a short. The lines should intersect as high and far away from the histogram as possible. Well, MACDM won’t work just like that, because it doesn’t see the main trend. Namely, we need to see when the trend will reverse in one direction or another. For example, like here. There is a clear signal to fall here, but the price has shot up. So how do we know when a trend is reversing? For this, we will consider the most powerful MACD indicator - convergence and divergence, which translates as convergence and divergence. But don't be afraid, in practice it's all much simpler than it sounds. The point is this. When the price updates its highs, but the indicator shows the opposite, that is, the new peak of the histogram does not update the previous one, we have a discrepancy, that is, divergence. Here's an example: the price of Bitcoin is going up, but in MACD it's the opposite, these waves on the histogram are going down, closer to zero. It turns out that the price on the chart is rising, but MACD says that the average fair price is decreasing. Plus, we see a perfect intersection of the lines, which means we can open a bearish position. And, as you can see, we were right, and the price went down. The situation is similar with the bullish position , but we need convergence. Let's look at the chart to see where the trend is weakening. We draw a line on the price chart from the maximum opposite each other. And you see, the lines converge with each other. Convergence is formed. We also make sure that these lines intersect below the zero mark. Great. This is a good signal for growth. In short, we guessed everything right again, and the price went up. If, for example, you find a weakening of the average price, but the Bitcoin price itself does not form a convergence, then we do not open a position. The same applies to the divergence when it is time to open a Now let's see how many positions we've managed to open on the positions we've managed to open on the Bitcoin chart over the past 3 months. I four o'clock the positions will be, as you understand, long. This is because one you understand, long. This is because one candle is 4 hours. And the growth process of Bitcoin itself is very low. It will grow by 5% there , then fall by 7%. Unlike cheatcoins, of course. If the Bitcoin falls by about 7%, then the shield falls falls by about 7%, then the shield falls by 30%. The same thing happens with growth. But I still advise you to trade Bitcoin, and preferably only on spot. Or try it on Bitcoin first, and then trade wherever you want. In short, let's scroll back three months to July 1st on the Bitcoin chart and start looking for where to open our first position. So, we immediately see that one wave is much smaller than the previous one, but the lines are practically at zero. Which means it doesn't suit us. We need a place where the line, as I said earlier, is as far away from zero as possible. Just like here. Here we observe a fading of interest, we draw a line and also look at the maximums to see where the trend is going. We also draw a line here. But we see that the price is rising, and the fair price or interest is falling. Many people call it different things. I call it interest. In general, we have a divergence, which means that at the intersection point we open a position, a intersection point we open a position, a bearish position, that is, a short. On the chart it will be approximately at this candle in this area. I open a position at a ratio of 1 k: d and immediately set a stop-loss and take-profit. Why is that? Position 1 to: Dm implies that in case of loss we lose one, and in case of profit we get two. In our case, if the price goes against our forecast, the position will be closed by a stop loss, and we will lose 2% of the transaction amount. But if the price goes according to our forecast, we the price goes according to our forecast, we will get 4% of our transaction. This is the case with Bitcoin. It's up to you to decide how to set percentages and whether to set stops. This is a separate topic for a video, as you understand. Personally, I feel more comfortable with stops, because if something happens, the price won’t fly off the charts and I won’t be stuck waiting for weeks or even months, or even worse, having to cover huge losses. No, I'll just get stopped out and lose some 2%, but I'll be able to open new positions again. New positions on more favorable terms. I also want to add that if the price has already gone up by 1-2% in an open position, it is better to move the stop to breakeven. Then there will be either 4% profit or zero. I wo n't do this because it often hits the stop and we get zero, and the price then returns. You are already looking at your strategy or repeat after me. So, let's say we opened here and look at where the price went. The next day the price almost reached the take profit, but it also depends on where exactly we opened on this candle . If they had opened a little higher, they would have closed the next day. But we will consider the worst-case scenario for the sake of fairness. They walked around here in the flat for a long, long time and finally closed. Plus 4% of the deposit to our piggy bank. We are looking for the next entry point. Here the lines are always around zero. And here, in principle, a good signal for principle, a good signal for an increase has formed. We draw lines. far away and intersects. This means we are opening the intersection. And here our long position is closed. another plus 4% to the piggy bank. Next I will speed up the video and open more positions. And just for clarity, one position was closed by a stop. -2%. What happened? In principle, interest was falling. The price has converged, everything is fine. MACD lines are far away. They opened and bam, they didn't make it. The price turned around and flew down. But that's the market, it's okay, it happens. This will inevitably happen. Either some news came out, or there were some other reasons. Don't other reasons. Don't get upset, move on In total, we have seven open positions: six positive and one negative. Now let's calculate how much we earned. 6 and 4 = 24 and -2. This results in 22% net profit in 3 months. That is, from $1,000 we would have earned $220. This is if exactly $1,000 was allocated for each transaction . On the one hand, it’s not much, but on the other hand, the risk of losing here was practically zero. Moreover, we entered the deal with the first leverage, and if we had taken the second leverage, the profit would have already been $440. Well, with the tenth leverage, the net $440. Well, with the tenth leverage, the net profit would already be $2,200. which is already not bad, but it’s a risk. Trading without stops with such leverage is dangerous, such leverage is dangerous, because -2% with the first leverage is -20% with the tenth leverage. That is, everything increases 10 times. And if, God forbid, it turns out that you only have $1,000 and three open positions in a row are negative, you will lose almost 60%. And you will open the next position for approximately $400, and this will reduce your profit. In general, practice risk management and don't go all in, especially with a lot of leverage. It is also not necessary to use a four-hour schedule. You can use it on both hourly and two-hour timeframes. I don't recommend trading on shorter timeframes, but again, although you can open positions more often, the risks also increase. You can set stops and take profits at support and resistance levels, or you can do as I do. The main thing for me is that you understand how the MACD and the indicator work and how you can use it to find good entry points. You can also combine this indicator with others and additionally open positions using other indicators. In general, I hope other indicators. In general, I hope you get the meaning. Thank you for watching the video to the end. I hope you found it useful. If so, please give it a like and subscribe to the channel to see more such helpful videos. Also, please leave a comment with a question or a thank you for me. I will be very pleased to read them. In the description crypto exchanges I trade on. By guaranteed to receive discounts on trading commissions and registration bonuses. There will also be links to my social networks in the description. Thanks again everyone for watching. Good luck with your trading, everyone. Bye everyone .