The moving average convergence divergence indicator uses
A)the difference in yields on stocks and bonds
B)the difference in yields between high and low quality stocks
C)the difference in a short-term moving average and a longer term moving average
D)the difference in the number of shares sold short and the number purchased

Question

Quizplus · Accepted Answer

The moving average convergence divergence (MACD) indicator is a trend-following momentum indicator that shows the relationship between two moving averages of a security’s price. It is calculated by subtracting the 26-period Exponential Moving Average (EMA) from the 12-period EMA, thus highlighting the difference between a short-term moving average and a longer-term moving average.

The Moving Average Convergence Divergence Indicator Uses