Technical Indicators – MACD

Technical Indicators
Technical Indicators

MACD (Moving Average Convergence Divergence), as we see from its name, shows the distance between the values of two exponential moving averages. This is an indicator for acceleration and it follows the direction of price movement, giving signals for change in the trend. Signals are obtained by crossing the zero line of the indicator, as well as by reaching extreme conditions. When the indicator values are above zero, the fast average is over the slow one and the market is in uptrend. When the indicator values are below zero, fast average is over the slow one and the market is in a downtrend.

The MACD histogram shows the difference between the values of the indicator and its signal line.

 

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