How to play with KDJ and MACD indicators?

KDJ and MACD are common indicators in foreign exchange investment. KDJ is a leading indicator and is generally used in short-term operations; while MACD is the deviation of the average cost of the market, which can reflect the overall trend of the mid-line. The combination of the two can more accurately determine the short-term fluctuations of foreign exchange prices. How to play with KDJ and MACD indicators?

The KDJ indicator, also known as the stochastic indicator, is represented by the K line, the D line, and the J line on the chart. This indicator takes into account the highest price and the lowest price in the calculation period, and takes into account the random amplitude in the stock price fluctuation. Therefore, it is believed that the stochastic indicator more accurately reflects the fluctuation of stock prices, and its prompt effect is more obvious.

According to the value of KDJ, it can be divided into several areas, namely overbought area, oversold area and wandering area.

According to the general classification standard, the three values of K, D, and J below 20 are oversold areas, which are buy signals;

The three values of K, D, and J above 80 are overbought areas, which are sell signals.

The three values of K, D, and J are between 20 and 80, which is a hovering area.

The MACD indicator, also known as the average of exponential smoothing similarities and differences, belongs to the general trend indicator. It consists of five parts: the long-term moving average MACD, the short-term line DIF, the red energy bar (long), the green energy bar (short), and the O-axis (long-short dividing line).

When the MACD is above the 0 axis and moves upward, it generally indicates that the market is in a rising trend, indicating a rise.

When the MACD is below the 0 axis and moves downward, it generally indicates that the market is in a downward trend, indicating a decline.

When the MACD is above the 0 axis but moves downward, it is generally expressed as a short-term correction in the rising market, and a short-term decline signal.

When the MACD is above the 0 axis but moves upward, it is generally expressed as a short-term correction in the falling market, and a short-term rise signal.