How to identify trend using MACD, Ichimoku Cloud, Trendlines in Silver
It is often difficult to identify the direction of prices when they are consolidating or moving in non trending direction. To get confirmation in which direction the commodity might get headed we use different momentum indicators which gives clear picture and possibilty of riding the future trend.
Below shows the chart and research applied on MCX Silver using ichimoku cloud MACD, with elliott wave counts which helped us to gauge the negative move.
MCX Silver hourly chart:
On daily time frame, currently wave f (blue) is under formation which seems to be forming diametric pattern. As shown on the hourly chart, Overall wave f seems to be moving in well channelized manner within which further down move could be in the form of wave (x).
Ichimoku Cloud: We can see prices have broken below the cloud indicating negative bias also future cloud is red. Also the base and conversion lines are placed above the prices confirming the bearish momentum.
MACD: The MACD indicator is a momentum indicator based on the difference of the 12 and 26 EMA. The MACD line crossing below the signal line indicates falling momentum. We can see on the hourly chart MACD is has cross the signal line on the downside and both are already below the zero line which indicates negative momentum.
Channel: Post breaking important support at 48600 levels prices moved lower towards lower trendline of the channel. Till now we have seen the metal has been precisely moving within the channel I.e reversing from channel resistance and bounce off from the channel support.
The above research proves that combining wave theory with different indicators such as Ichimoku cloud, Channels, MACD etc. It helped in identifying the trend in MCX Silver which is negative.
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