When DIF breaks through DEA from top to bottom, it forms a death cross (that is, the cross formed by white DIF wearing yellow DEA), or the MACD red column turns green, at this time, a sell signal is formed. When this selling point was formed, the two moving averages of MACD indicators were arranged in a long position, and the short-term moving average began to move closer to the long-term moving average, but it did not die. EIF had already died on the DEA line. MACD's dead fork is generally divided into two situations.
1. Dead fork above zero axis: DIF line and DEA line form a dead fork above zero axis.
It should be noted that this selling signal is a relative peak, describing a top area, not necessarily the highest point of market rise. The best situation to sell by using the dead fork is that the stock price is sideways after a sharp rise, thus forming a relatively high point, and investors, especially those with large funds, must sell or lighten their positions at this time. Such a "death cross" indicates the end of the long-term rise of the stock price, and another round of decline trend of the stock may have begun, and the stock price may begin to fall for a long time. Therefore, investors should pay special attention to the "death cross" of this MACD indicator, and should sell all or most of the stocks on rallies in time, especially those that rose too high in the previous period. Figure 1—— China Unicom (600050) 0919-May 2 1 daily chart.
In the software (Baidu can download it for free), as shown in figure 1, A's share price rises rapidly. When MACD changed from red column to green column, the two lines were dead (point A in the figure), the stock price had fallen for several trading days. Even so, after the selling point is formed, it is still necessary to teach the church to resolutely sell stocks, because the MACD two lines run downward, and there may be a greater decline in the later period. At point B, the stock price rose sideways for several trading days. Later, when MACD formed a dead fork, the selling point appeared. At this time, the stock price is still at a relatively high point and has not fallen sharply. Then you must resolutely follow the software instructions to sell. At this time, selling point is the best selling point.
2. Dead fork below zero axis: DIF line and DEA line form a dead fork below zero axis.
When the DIF line and DEA line are below the zero axis, the stock price tends to run in a downward trend. At this time, if the DIF (white line) crosses the DEA (yellow line) from above again, forming a dead fork below the zero axis, it often means that the stock price rebounds in the downward trend. After the formation of the dead fork, the stock price re-entered the downward trend, and at this time, it should be based on selling stocks.
In the software (which can be downloaded for free by Baidu), as shown in Figure 2, A, B and C respectively correspond to the position where the stock price rebound ends. When the MACD of these three places formed a dead fork, the stock price began to fall again. Figure 2- Daily chart of Baotou Steel (6000 10) from April 17, 2008 to October 5, 2008.