MACD stands for Moving Average Convergence Divergence. It is a technical analysis (TA) indicator created by Gerald Appel in the 1960s. It shows the difference between a fast and slow exponential moving average (EMA) of closing prices. MACD is made up of 2 lines. The MACD Line and MACD Signal Line.

Setting:

Common MACD setting is 12, 26, 9. The standard periods recommended by Gerald Appel; 12 and 26 days.

MACD is plotted = EMA [12] of price – EMA [26] of price

MACD signal line is plotted by smoothing MACD line with a further EMA. Sometimes, SMA (simple moving average) is used. The standard period for this is 9 days;

(MACD) Signal line = MEA [9] of MACD

In 1986 Thomas Aspray created MACD Histogram. It is the difference between the MACD and the signal line and it represents in a solid block histogram style;

(MACD) histogram = MACD – Signal Line

Usage:

MACD is a trend following tool and a momentum indicator that shows acceleration and deceleration of a trend. It is useful for spotting major trend reversal.

• MACD line crossing the signal line.
• MACD line crossing zero line.
• Divergence between price and histogram, or between MACD line and price.

Buy Signals – when the MACD Line crosses above the MACD Signal Line or MACD Line crosses up Zeroline. Sell Signals – when the MACD Line crosses below the MACD Signal or MACD Line crosses down Zeroline. Divergence for spotting the trend reversal.

These are the Top 10 stocks in volume showing MACD signals; a 2-day scanning results for trading closed 8 October 2009.

Definition:

MACD stands for Moving Average Convergence Divergence. It is a technical analysis indicator created by Gerald Appel in the 1960s. It shows the difference between a fast and slow exponential moving average (EMA) of closing prices. Common MACD setting is 12, 26, 9.

Setting:

MACD is made up of 2 lines. The MACD Line and MACD Signal Line.

Usage:

Buy Signals – when the MACD Line crosses above the MACD Signal Line or MACD Line crosses up Zeroline.
Sell Signals – when the MACD Line crosses below the MACD Signal or MACD Line crosses down Zeroline.

Disclaimer

The information are not meant to be used for buy or sell decision. We do not recommend particular stocks. If particular stocks of such are mentioned, they are meant as demonstration of Amibroker as a powerful charting software and MACD. These are script generated signals. Not all scan results are shown here. The MACD signal should use with price action. Users must understand what MACD and price action are all about before using them. If necessary you should attend a professional course to learn MACD. Once again, the website does not guarantee any results or investment return based on the information and instruction you have read here.