MACD
The moving average convergence divergence indicator: the difference between a fast and a slow exponential moving average of price.
Formula
MACD Line = 12-period EMA - 26-period EMA; Signal Line = 9-period EMA of the MACD Line
Unit
₹
In depth
MACD measures the gap between two averages, so it is positive when the shorter average is above the longer and rises when that gap widens — it describes the rate at which price is separating from its own trend. It is unbounded, unlike an oscillator, so its readings are not comparable across securities or across price levels: a MACD of 3 means something different on a ₹60 stock and a ₹3,000 one. Users typically watch three things: the zero-line crossing, the signal-line crossing, and divergence against price. All three are descriptions of a smoothed series, and none is a forecast.
Worked example
A 12-period EMA of ₹506 and a 26-period EMA of ₹496 give a MACD of ₹10. On a ₹60 stock the same ₹10 gap would be impossible — the reading scales with price, which is why cross-stock comparison is meaningless.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “MACD” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.