MACD (MACD)

The gap between a 12-day and a 26-day exponential moving average, with a 9-day signal line.

MACD was developed by Gerald Appel in the late 1970s. The MACD line is the 12-day exponential moving average minus the 26-day one; the signal line is a 9-day exponential average of the MACD line, and the histogram is the gap between the two.

The MACD line crossing above its signal line is commonly read as momentum turning up, and crossing below as momentum turning down. Above zero means the shorter average is above the longer one.

Also called: MACD · moving average convergence divergence