The MACD is one of the most popular indicators. As its name suggests (Moving Average Convergence Divergence) is based on the convergences and divergences of moving averages.
The MACD can be represented by a curve (blue) with MME9 (red) dotted or not depending on the parameter setting of graphs. The Exponential Moving Average is also called MS: signal.
The MACD can also take the form of histograms.
In both cases, the MACD line has a (zero) and gives the same information, only the comfort of reading and interpretation depends on the trader or investor.
The MACD is simply the difference between two Exponential Moving Averages of different period. Are commonly used periods of 12 and 26 days for the MME (E Exponential whose formula is = MME close of day * 0.09 + MM of the day * 0.91).
Unlike the previous indicators, MACD is used in a market-oriented. Indeed, this type of market lends itself to cross moving averages, which is what this basic MACD.
Similarly, the detection of differences can predict a trend reversal.
