Results
What is MACD?
MACD (Moving Average Convergence Divergence) tracks the gap between a fast and a slow EMA. A third EMA, the signal line, smooths that gap, and the histogram shows the difference between the two.
MACD line = Fast EMA − Slow EMA
Signal line = EMA of the MACD line
Histogram = MACD line − Signal line
Signal line = EMA of the MACD line
Histogram = MACD line − Signal line
How to read it
- MACD above the signal line suggests upward momentum. MACD below the signal line suggests downward momentum.
- A crossover, where the MACD line crosses the signal line, is what many traders watch. It is a lagging signal, since it appears after prices have already moved.
- The histogram shows the gap between the two lines. It grows when momentum is building and shrinks as the lines converge.
Common questions
Why 12, 26 and 9?
These are the lengths Gerald Appel originally used, and most platforms still default to them. You can change all three in Settings.
Is MACD a version of the EMA calculator?
It builds on the same EMA maths as the EMA calculator, applied twice: once for the fast and slow lines, and again for the signal line.
Why does MACD need more history than a simple moving average?
Each EMA depends on all the bars before it, and the signal line is an EMA of the MACD line itself, so early values are less reliable. Two years of daily bars or more gives steadier results.