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There are two MACD lines and a MACD signal line. What is the third line?

April 26, 2017line macd signal

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There are two MACD lines and a MACD signal line. What is the third line?

1 Answer

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The MACD line is calculated on the closing price and on the average price of each bar. This generates two MACD lines. The intent is for you to be able to see if the stock is closing strong compared to its average. If the closing MACD line crosses over the average MACD line, the trend is in jeopardy. The closing MACD line will lead the average MACD line in a strong trend.