Indicator | Technique
MACD (Moving Average Convergence Divergence)
"The MACD is a momentum indicator revealing the relationship between two moving averages of a price, signaling reversals and trend strength."
In-Depth Definition
The MACD, developed by Gerald Appel, is one of the most popular indicators in technical analysis. It consists of three elements: the MACD line (difference between the 12 and 26 EMA), the Signal line (9 EMA of the MACD line), and the Histogram (difference between the MACD line and the Signal line). A MACD line crossing above the Signal line is a buy signal; crossing below is a sell signal. The histogram crossing above/below zero confirms the signal. Divergences between the MACD and price are among the most powerful signals: a bullish divergence (price falling, MACD rising) often anticipates an upward reversal. The MACD is a lagging indicator but very useful for confirming trends.
StarQuant Insight
StarQuant scans MACD divergences across hundreds of assets simultaneously on all timeframes, crossing these signals with volume and market structure data to retain only high-probability setups.
Pro Tip
MACD is particularly reliable on higher timeframes (H4, Daily). On lower timeframes it generates many false signals. Combine it with price structure analysis to filter entries.