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Strategies & Market Trends : Technical Analysis - Beginners

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To: browser who wrote (8711)9/28/1998 9:15:00 PM
From: Nazbuster  Read Replies (1) of 12039
 
Browser,

As I understand it, MACD is a measure of the difference between two moving averages, with the difference itself then taken as a moving average.

You'd expect the shorter period (8 days, hours, minutes...) to zig-zag faster than the longer period (17) since the shorter period won't have all the history to drag the average down when the stock moves. By taking the moving average (9 periods) of the difference, you "smooth" the difference measurement.

MACD is a nice way to see if the trending is changing.
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