A Caution on Using MACD Setupsby Boris Schlossberg
Although the MACD set-up may have shown some success in the past, this successful past performance is not necessarily indicative of future success. Not only will the set-up sometimes fail outright by producing false signals, but it can also generate a losing trade even if the signal is accurate. Remember that while momentum indicates a strong presence of trend, it provides no measure of its ultimate potential. In other words, we may be relatively certain of the direction of the move, but not of its amplitude. As with most trading set-ups, the successful use of the momentum model is much more a matter of art than science. Remember, trading of forex poses significant risks and is not suitable for all persons. Past performance is not necessarily indicative of future results.