Technical Analysis: Exploring MACD in the Lebanese Stock Market

Hussin Jose Hejase

Abstract


The stock markets have shown a great growth in the financial world that required traders to deal with many quantitative methods to analyze markets in order to predict commodities’ future prices. This study assesses the effect of technical analysis on the Lebanese stock markets by using a tool known as the Moving Average Convergence/Divergence (MACD) oscillator that explores how MACD can be utilized to optimize profits in the Lebanese stock exchange, during the trading process. The study is performed on closing prices of shares of six Lebanese banks and a real estate company, over a time period extending from the beginning of the year 2004 till the end of the year 2014. Results are meant to indicate whether MACD is able to optimize profits and forecast the Lebanese stock prices. It is concluded that the application of MACD in the decision making process for investing in the Lebanese stock market does not significantly contribute to the maximization of profitability on investments.


Keywords


Technical analysis, MACD, Lebanon, Lebanese stock market, BSE, ROI

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