Definition of MACD (Moving Average Convergence Divergence)
A trend-following momentum indicator that shows the relationship between two exponential moving averages (typically 12 and 26 periods). Used to identify trend direction, strength, and potential reversals.
At a glance
Term
MACD (Moving Average Convergence Divergence)
URL slug
macd-moving-average-convergence-divergence
Category
Analysis
Short answer
A trend-following momentum indicator that shows the relationship between two exponential moving averages (typically 12 and 26 periods).
Deep dives
Full A–Z glossary
Example
Apply the definition: restate “MACD (Moving Average Convergence Divergence)” in one sentence tied to your next trade (symbol, direction, size, stop). If you cannot, re-read the definition above.
Common mistake
Common mistake: using “MACD (Moving Average Convergence Divergence)” as loose slang while your broker/platform specification defines it more narrowly.
Professional tip
Tip: bookmark this “MACD (Moving Average Convergence Divergence)” page and reopen it when reading broker specs so definitions stay consistent.
Practice tools:
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FAQ
A trend-following momentum indicator that shows the relationship between two exponential moving averages (typically 12 and 26 periods).
Knowing the precise definition of “MACD (Moving Average Convergence Divergence)” prevents platform and broker-spec mistakes—a common source of size and cost errors.
Common mistake: using “MACD (Moving Average Convergence Divergence)” as loose slang while your broker/platform specification defines it more narrowly.