How Do You Calculate The MACD Histogram?
The MACD or Moving Average Convergence Divergence is a popular technical trading tool used by short term and intermediate traders. Developed by Gerald Appel, he recommends its use as the statistical difference of two exponential moving averages, but it has been popularized as the difference of 26 and 12 day exponential moving averages and a signal line. Compute the 26 day exponential moving average of the stock, bond, equity, futures, or currency under study. The exponential moving average is a manipulation of a moving average by adjusting the weight in favor of the most recent data. Information on computing an exponential moving average may be found in Resources. Any spreadsheet program also contains an exponential function. Compute the 12 day exponential moving average of the stock, bond,equity, futures or currency under study. Then subtract the 26 day result from the 12 day average. Plot the result. Create a 9-day moving average and plot as a dotted line. This is called the signal l
