what is MACD trading ?

# **What is MACD Trading?**

MACD (**Moving Average Convergence Divergence**) is a trend-following momentum indicator used to identify **trend direction, strength, and potential reversals**.

## **1️⃣ Key MACD Components**
✅ **MACD Line:** Difference between the **12-day & 26-day EMA**.
✅ **Signal Line:** **9-day EMA** of the MACD line (triggers buy/sell signals).
✅ **Histogram:** Measures distance between MACD & Signal Line (momentum strength).

## **2️⃣ How to Trade with MACD**
✅ **MACD Crossover:**
🔹 **Bullish:** MACD crosses above Signal Line → **Buy signal**.
🔹 **Bearish:** MACD crosses below Signal Line → **Sell signal**.
✅ **MACD Divergence:**
🔹 **Bullish:** Price makes **lower lows**, MACD makes **higher lows** → **Uptrend reversal**.
🔹 **Bearish:** Price makes **higher highs**, MACD makes **lower highs** → **Downtrend reversal**.

### **Conclusion**
MACD is a **powerful tool for trend confirmation and momentum analysis**. Using it with **support-resistance and volume** increases trade accuracy. 🚀