Definition
A chart tool built from the gap between two moving averages, used to gauge how strong a trend is.
The story
When a short-term average pulls away from a longer one, the trend is picking up speed. When they draw together, it's losing steam. MACD (Moving Average Convergence Divergence) puts that gap on a chart of its own.
Why you'll see it
It appears in chart-heavy commentary on indexes and gold.
Connects to
Moving averageExponential moving averageChart divergenceMomentum
We explain why it moves markets. What you do with it is your call. Commentary and education only. Not financial advice. All terms