MACD and graph divergences

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Lucacrebbe
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Joined: Thu Sep 21, 2017 3:23 pm

Mon Nov 13, 2017 11:39 pm

Hello someone here uses this to gain profits?

I mean about looking at divergences between MACD and the graphs of the odds to choose the right moent to enter into a trade.
May it be helpful?
Suggestions , adviceses please

Derek27
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Location: UK

Tue Nov 14, 2017 7:58 pm

It's an interesting idea, but personally I don't think something like this that's designed for longer-term markets would be useful on fast moving Betfair markets.

https://www.investopedia.com/terms/m/macd.asp

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ShaunWhite
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Tue Nov 14, 2017 8:17 pm

The issue with taking financial TA and applying it to sports markets is that the constituants of a sports market are inexorably interconnected due to the market overround constraints.

The constituants of a finacial market aren't connected, excpect via mechiniams that apply equally to all, eg fx, sector & geographic conditions. They can all rise, or all fall. Selections in a sports market can't do that and their prices move like the horses on a carousel, where if some go up them some must go down. They are very different markets.

Watching and trying to predict to price movement on an individual selection is almost pointless without also tracking the orders on the other selections.

Derek27
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Tue Nov 14, 2017 9:50 pm

Since Luca drew my attention to MACD, I decided to look at the graph on a couple of short-priced favourites in a volatile market. Sure enough, the lines did cross every time the price reverses, but it crossed at the same time as the reversal, not in advance.

Perhaps when applied to 25 days of data in a financial market it may be useful, but on an exchange trading chart, a day equates to 5 or 10 seconds, so you might just have 100 milliseconds of thinking time !

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ruthlessimon
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Tue Nov 14, 2017 10:01 pm

Derek27 wrote:
Tue Nov 14, 2017 9:50 pm
but it crossed at the same time as the reversal, not in advance.
& it always will (or lag). The clue is in the name "moving average"

Derek27
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Tue Nov 14, 2017 11:52 pm

ruthlessimon wrote:
Tue Nov 14, 2017 10:01 pm
Derek27 wrote:
Tue Nov 14, 2017 9:50 pm
but it crossed at the same time as the reversal, not in advance.
& it always will (or lag). The clue is in the name "moving average"
It's not about moving averages but the convergence or divergence of two moving averages.

Whether it lags behind or forward by two seconds doesn't really matter, because I don't think you can glean any more information from it than you would just by looking at the Betfair price movements on the ladder.

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ruthlessimon
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Wed Nov 15, 2017 1:39 am

Derek27 wrote:
Tue Nov 14, 2017 11:52 pm
It's not about moving averages but the convergence or divergence of two moving averages.
A divergence will lead. However, as a side, those blindly following MACD divergences will get absolutely hammered on strong trending days (i.e. yesterday). The majority of pullbacks will look like a reversal to the MACD after a strong move.

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