MCAD Solutions

A popular variation of a price oscillator is the Moving Average Convergence-Divergence or MACD. MACD is a price oscillator that uses two lines rather than one. The first line, known as the MACD line, is calculated by taking the difference between two exponential moving averages. The most common time periods used are 12 and 26. A second line, often referred to as the signal or trigger line, is formed by computing a nine-period moving average of the difference between the earlier mentioned exponential moving averages. In its simplest form, MACD can alert traders to potential buying opportunities when the trigger line moves above the MACD line and potential selling opportunities when the trigger line moves below the MACD line