In our previous tutorial on MACD, we’ve learned the basics of MACD. In this tutorial, we’ll try to understand MACD in detail.
Introduction to MACD
The MACD indicator (moving average convergence divergence, which translates as convergence or convergence – the divergence of moving averages) is, on the one hand, classed as oscillators, on the other hand, it can also be referred to the class of complex averages, since it is nothing more than an improved visual the perception of two simple moving averages (or exponential moving averages). It is believed that the MACD indicator significantly reduces the inherent drawbacks of moving averages.
MACD Formula
There are two ways to build and analyze MACD:
- MACD linear, which is more often used for the analysis of the trenches;
- MACD-histogram, by the method of analysis and value rather refers to the class of oscillators.
1. Linear MACD
To calculate the linear MACD from the moving average price (usually an exponential moving average is…