MACD (12,27,9) Signal Line cross

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MACD (12,27,9) Signal Line cross

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MACD Signal line is the 9-day EMA of the MACD indicator and is used to identify turns.  Signal line crossovers are the most common MACD signals.  A bullish crossover occurs when the MACD turns up and crosses above the signal line. A bearish crossover occurs when the MACD turns down and crosses below the signal line.

MACD is a trend following and momentum indicator, calculated by subtracting a longer moving average (26 day EMA) from a shorter moving average (12 day EMA). MACD fluctuates above and below the zero line as the moving averages converge, cross and diverge. A 9-day EMA of the MACD Line is plotted with the indicator to act as a signal line and identify turns. Traders can look for signal line crossovers, centerline crossovers and divergences to generate signals. Potential buy signals occur when the MACD moves above zero (center line) or above the signal line, and potential sell signals when it crosses below zero or below the signal line.