Charts

Moving Average Convergence Divergence (MACD)

Description

The Moving Average Convergence Divergence (MACD) was developed by Gerald Appel, and is based on the differences between two moving averages of different lengths, a Fast and a Slow moving average. A second line, called the Signal line is plotted as a moving average of the MACD. A third line, called the MACD Histogram is optionally plotted as a histogram of the difference between the MACD and the Signal Line.

Formula

[\MACD = FastMA - SlowMA\]

where:

  • FastMA is the shorter moving average and SlowMA is the longer moving average.
  • SignalLine = MovAvg(MACD)
  • MACD Histogram = MACD- SignalLine