Glossary
MACD
Technical Analysis
MACD is a trend and momentum indicator built from the difference between two exponential moving averages, usually the 12- and 26-period.
The MACD line is the 12 EMA minus the 26 EMA; the signal line is a 9-period EMA of the MACD line; the histogram is the gap between them. Crossovers above and below zero indicate the shift between the shorter and longer trend.
Because it is derived from moving averages, MACD lags price and produces frequent false signals in ranges. It is most useful for confirming a trend already visible in structure, and for spotting momentum divergence.