Abbreviation for Moving Average Convergence/Divergence, a trend-following dynamic indicator that shows the correlation between two moving averages, generally a 26-period and 12-period Simple Moving Average or Weighted Moving Average or Exponential Moving Average. You can modify the period length when you create the study. To help illustrate opportunity, a 9-period EMA “signal line” is plotted on top of the MACD

The MACD and signal line are plotted using the following calculations:

MACD = MA(CLOSE, 12)-MA(CLOSE, 26)

SIGNAL = EMA(MACD, 9)

MACD Histogram/OSMA = MACD – SIGNAL

Where:

MA — Simple or Weighted or Exponential Moving Average;

SIGNAL — the signal line of the indicator.