Recently, while studying trading systems, I’ve become increasingly aware of a problem—many people use MACD, but most have never actually adjusted the MACD settings.

Honestly, the default 12-26-9 parameters are quite handy, but they may not suit your trading style. I spent a lot of time backtesting to realize this.

First, let’s talk about what MACD actually does. It has three core components: the fast line reflects short-term momentum, the slow line tracks long-term trends, and the signal line helps you judge entry and exit points. The reason the 12-26-9 combination is so widely used is because it’s stable—EMA(12) looks at recent two weeks’ changes, EMA(26) shows momentum over the past month, and combining them helps identify medium-term trends, with EMA(9) filtering out noise. Plus, since most traders use it, a market consensus forms, making key signals more likely to attract attention.

But that’s the problem. If you’re doing short-term trading or operating in highly volatile crypto markets, 12-26-9 is too smooth and can’t catch small-cycle opportunities.

I tried the 5-35-5 setting, which reacts very quickly but also produces a lot of noise. Last year, when backtesting Bitcoin’s daily data over six months, the 12-26-9 gave 7 clear signals—2 valid golden crosses and 5 invalid. Meanwhile, the 5-35-5 produced 13 signals, with only 5 being effective. It looks like 5-35-5 signals more often, but most are small rises or dips, offering limited profit.

That doesn’t mean 12-26-9 is the best either. The 8-17-9 setting suits 1-hour forex charts and more volatile markets, 19-39-9 is better for medium to long-term swings, and 24-52-18 is ideal for long-term investors. The higher the sensitivity, the faster you catch trends, but the more noise you get; lower sensitivity yields more reliable signals but fewer opportunities.

Many traders, after adjusting MACD settings, fall into a trap—they think they’ve found the perfect parameters. In reality, there’s no perfect setting because markets and cycles vary too much. Even more dangerous is overfitting—tweaking parameters to fit past data just to make backtest results look good. The result is a dazzling backtest performance but poor real-world results.

My advice is this: beginners should stick with 12-26-9, observe for a while, and get a feel for the indicator’s rhythm. If you find this setting often inaccurate, then try fine-tuning based on your trading habits. For example, if you prefer short-term trading, you might try 5-35-5 or 8-17-9, but always backtest first to see if it truly aligns with your entry and exit logic.

Most importantly, once you choose a MACD setting, stick with it—don’t change parameters frequently. Some traders use two MACD setups simultaneously to filter noise, which is fine, but it also increases signals and makes judgment more difficult.

At the end of the day, MACD is just a tool. Even the best tool requires you to understand the market yourself. Instead of chasing the perfect MACD setting, spend time figuring out how to integrate it into your overall trading system. When observing various assets on Gate, I also adjust parameters flexibly based on different cycles, which yields better results. Remember, there’s no one-size-fits-all solution—only what works best for you.