Guidebook No. 4 of the Samxon Market Indicator Series. A 12-page PDF guide by Paul Samson (Samxon.ca).

The MACD is one of the most widely used indicators in the world, built into virtually every charting platform. It earns that place by doing two jobs at once: it follows the trend and measures the momentum behind it. This guidebook explains how it works, where it came from, and how to read it well.

Inside:

• The MACD line, signal line and histogram
• Gerald Appel’s development of the indicator in the late 1970s, and Thomas Aspray’s histogram
• The standard settings
• Five ways traders use the MACD
• Its close relationship to the Percentage Price Oscillator (PPO), with practical examples of when and why to use the PPO instead
• The MACD’s place in the market cycle, plus a worked example

The central idea: the MACD and PPO turn at the same bars, so the choice between them depends on what you are comparing. The histogram often warns of a turn well before the crossover confirms it.

Instant PDF download. For educational purposes only; not financial advice.