# MACD - Moving Average Convergence / Divergence

Moving average convergence divergence (MACD) is a trend-following momentum indicator that shows the relationship between two moving averages of a security’s price.

The MACD is calculated by subtracting the 26-period exponential moving average (EMA) from the 12-period EMA. Moving average convergence divergence (MACD) indicators can be interpreted in several ways, but the more common methods are crossovers, divergences, and rapid rises/falls.

**Within this indicator, what strategy does Anny offer?**

1. MACD crossing over the signal line

3. MACD trend reversal (divergent price peaks)

**1. MACD crossing over the signal line **

**Logic of the algorithm:**

- For long signals the algorithm scans for a cross-over of the MACD line over the signal line occurring below the histogram line.
- For short signals the algorithm scans for a cross-under of the MACD line over the signal line occurring above the histogram line.

**Configuration:**

- Pre-configured for the candle of 1h (going below 30 min is not advised)

**2. MACD trend convergence**

**Logic of the algorithm:**

- Identifies if the last entries of the histogram represent an uptrend.
- Evaluates if the signal line is within the histogram.
- Evaluate if the price peaks of the histogram favor the trend.

**Configuration:**

- Pre-configured for the candle of 1h

**3. MACD trend reversal (divergent price peaks)**

**Logic of the algorithm:**

- Identifies if the last 2 entries of the histogram are trending up and if before that, there's a meaningful downtrend block.
- Evaluates if the signal line falls outside the histogram.
- Evaluates if the price peaks of the histogram are against the trend.

**Configuration:**

- Pre-configured for the candle of 1h

**Hints💡**

- For an additional confirmation, combine it with another indicator.