MACD

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The Moving Average Convergence Divergence is an extremely popular indicator used in technical analysis. It calculates 2 exponential moving averages of the lengths specified by the inputs FastLength and SlowLength. The difference between these 2 averages is then displayed as the MACD. This value is also averaged for the number of bars specified by the input MACDLength and then plotted as the MACDAvg. Finally, the difference between the MACD and the MACD average is calculated and plotted as the MACDDiff.
MACD can help to identify not just trends, but it can measure momentum as well. When the MACD crosses above the MACD Average, it may be the beginning of an uptrend. Conversely, when the MACD crosses below the MACD Average, it may be the beginning of a downtrend. As an oscillator, the MACD reflect overbought and oversold conditions.

Default Inputs

FastLength (12) sets the number of bars to include in calculation of the fast exponential average.
SlowLength (26) sets the number of bars to include in calculation of the slow exponential average.
MACDLength (9) sets the number of bars used to calculate the MACD exponential average.

MACD indicator.png