What Is MACD Indicator? How To Use It?

MACD stands for "Moving Average Convergence Divergence". It is one of the most common indicators in medium-term trend analysis In MACD, we take the mean of the subtraction of moving averages from each other. Then compare this mean with general average to prove the trend analysis. A zero value on the Macd indicator is important. The positive field is above the 0 value. The negative field is less than the value of 0.

MACD indicates the difference between moving averages. Fast, Medium, or Slow-moving averages, which is usually calculated from the difference between the 26-day and 12-day averages. It is shown as a blue line on the graph. MACD has 2 .

1. Trigger Line (Signal):
   Gives the moving average of the Macd line. Usually shows 9 or 10 day average. It is shown as a red line on the graph.

2. Histogram: Shows the difference between Macd line and Trigger line.

Macd below 0 indicates that Coin is oversold. Macd over 0 indicates coin is overbought.
If the Macd line draws the trigger line upwards, the increase is noticeable. However, for a solid trend in the middle-term. The Macd line must go through the trigger line, from the negative area to the positive area, upwards from zero.
When Macd is above zero, we can conclude that the 12-day and 26-day averages are equal.

Let's examine how to use the Macd indicator on a sample;

For more effective analysis, many indicators and factors should be examined and interpreted together.