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Moving Average Convergence Divergence (MACD)
A trend indicator used to show the relation between two moving averages of prices

with the MACD chart ,You will see three numbers
• 1- the number of periods used to calculate the faster moving average.
• 2-the number of periods used to calculate the slower moving average
• 3- the number of bars used to differentiate between the fast and slow moving averages.
There are three methods to use MACD:

1. the Crossovers – when you look at the chart, you will see the MACD go under the signal line, that means it may be the time to sell. , when the MACD rises up the signal line it may be the time to buy.

2.the Divergence - It may be a signal of the end of the trend When the security price diverges from the MACD..

3. the Dramatic rise - When the MACD rises –-it is a signal that the security is overbought and will return to the normal levels as soon
Ok,so you now know what is the MACD . Let's see what can MACD do for you.
MACD crossover is a signal to buy or sell
re are 2 moving averages with different speed, the faster will be quicker to react to price movement than the slower. When a new trend is done, the fast line will reach first and cross the slower line. When the “crossover” happens , and the fast line starts to move away from the slower line, it indicates that a new trend is formed.

YOU CAN SEE FROM THIS CHART THAT THE FAST LINE CROSSED UNDER THE SLOW LINE AND THAT’S MAKE A NEW DOWNTREND. WHEN THE LINES CROSSED, THE HISTOGRAM DISAPPEARS.COZ THE DIFFERENCE BETWEEN THE LINES WHEN THE TIME OF THE CROSS IS 0.
THR MACD STILL ONE OF THE MOST FAMOUS TYPES USED BY MANY TRADERS.

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