Macd

well, for those of you who recognize my name, you might think I am trying to be a jerk, but I assure you I am not. I am trying to learn this, and I am pretty sure there are lot of typos (or misinformation) in various sections. or maybe I have lost some of my marbles… very possible…:slight_smile:

that all being said.

under the MACD article, I found this.

“There is a common misconception when it comes to the lines of the MACD. The two lines that are drawn are NOT moving averages of the price. Instead, they are the moving averages of the DIFFERENCE between two moving averages.”

but the fact is, the two lines could not be differences between two moving averages could they? There is only one difference between two moving averages!! IF they are DIFFERENCES, can somebody give an EXPLICIT example, complete with numbers.

so, it seems to me that the two lines ARE INDEED moving averages of the price, and the HORIZONTAL BARS represent the difference.

can somebody confirm this?

thanks again
John

May I put it this way - it doesn’t really matter what they are, it won’t have any major impact on your trading.

Funny PPF your right on;)

Do a Google search for MACD formula there are a few sites that have examples of how a MACD is plotted with examples. One of the lines is a moving average the other line is the difference of 2 moving averages.

“There is a common misconception when it comes to the lines of the MACD. The two lines that are drawn are NOT moving averages of the price. Instead, they are the moving averages of the DIFFERENCE between two moving averages.”

the above does seem wrong to me. is that from the Baby pips school? there are a few threads about mistakes in the school If it is from the BP school you should put it in one of those mistake threads so it might get fixed.