What is the MACD in Stock Trading?

The Moving Average Convergence Divergence (MACD) is a popular momentum indicator used in stock trading to help identify potential buy and sell signals. It analyzes the relationship between two moving averages of a stock's price, typically the 12-day and 26-day exponential moving averages (EMAs). The MACD is composed of the MACD line, the signal line, and a histogram that represents the difference between these two lines. When the MACD line crosses above the signal line, it’s often considered a bullish signal, while a crossover below the signal line can indicate a bearish trend.

The MACD is commonly used by traders to spot trends, potential reversals, and momentum shifts, making it an essential tool for technical analysis. Whether you’re a beginner or experienced trader, understanding how the MACD works can give you a clearer picture of market conditions and improve your decision-making process.

For those looking to dive deeper into the MACD and its impact on stock trading, check out this detailed guide. If you're interested in utilizing a stock screener to find stocks that meet your specific criteria, visit our Stock Screener tool. Additionally, for real-time MACD signals, explore our MACD Daily Crossed Above Signal Line page.