Let’s discuss this MACD death cross after $ZEC 4 hours. First, it’s important to understand two limitations of the indicator:
First, it lags. MACD is derived from moving averages, so by the time a death cross appears, the price has usually already fallen some distance from its high (24h -7.64%).
Second, it doesn’t work well in choppy markets. In a range-bound market, golden crosses and death crosses can keep appearing back and forth, producing plenty of false signals.
Before this crossover, the opposing histogram bars persisted for 21 four-hour candles. The one-way move had some length, making this crossover cleaner than one in a choppy market. Also, since it’s above the zero line, treat it as a correction for now—not necessarily a reversal.
First, it lags. MACD is derived from moving averages, so by the time a death cross appears, the price has usually already fallen some distance from its high (24h -7.64%).
Second, it doesn’t work well in choppy markets. In a range-bound market, golden crosses and death crosses can keep appearing back and forth, producing plenty of false signals.
Before this crossover, the opposing histogram bars persisted for 21 four-hour candles. The one-way move had some length, making this crossover cleaner than one in a choppy market. Also, since it’s above the zero line, treat it as a correction for now—not necessarily a reversal.