MACD

Moving Average Convergence/Divergence manipulates moving averages, which are lagging indicators, to include trend following. Two moving averages are used, one longer than the other, to compare how their trends match each other. To do this, one is subtracted from the other, and the results are plotted on a graph that oscillates above and below zero. The shorter time period is described as the "fast length" and the longer period as the "slow length". The greater the oscillations, the greater the volatility of the security.