Knowledge center · Technical analysis
MACD (12, 26, 9)
Moving-average convergence/divergence — measures whether price momentum is building or fading.
Formula
MACD line = EMA(12) − EMA(26); signal = EMA(9) of the line; histogram = line − signal.
Interpretation
A positive histogram means momentum is improving relative to its own recent pace; negative means fading. It measures the change in momentum, not its level.
What good looks like
Histogram positive and expanding while price makes new highs.
What bad looks like
Price making new highs while the histogram shrinks — momentum divergence.
Typical range
Unbounded and price-scale dependent — compare the sign and direction, never the absolute value across stocks.
Limitations
Price-scale dependent: on a falling stock the histogram mechanically contracts toward zero as the price shrinks, which can read as “improving” during a long decline. Whipsaws badly in flat markets.
How OmniSignal uses it
The fastest of the classic trend gauges — it turns before the moving averages themselves do.
Where it enters the score
A MACD state variant feeds the engine’s momentum sleeve as a low-weight (0.5) trend feature; the value here is recomputed from the same price history for display.
References
Appel (1979)
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