Enter the 12-period exponential moving average and the 26-period exponential moving average to determine the moving average convergence divergence (MACD).

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## MACD Formula

The following formula is used to calculate the moving average convergence divergence.

MACD = 12 EMA – 26 EMA

- Where MACD is the moving average convergence divergence
- 12EMA is the 12 period exponential moving average
- 26EMA is the 26 period exponential moving average

## MACD Definition

**What is MACD? **

MACD, short for moving average convergence divergence, is a metric or indicator used in finance that shows the relationship between the moving averages of a security. The MACD is considered a trend-following momentum indicator.

The moving averages used are the 12-period and 26-period exponential averages.

## Example Problem

**How** **to calculate MACD? **

First, determine the 12-period moving average. For this example, the exponential 12-period value is found to be $5.50.

Next, determine the 26-period moving average. For this example, this moving average is found to be $3.50.

Finally, calculate the MACD using the formula above:

MACD = 12 EMA – 26 EMA

MACD = $5.50 – $3.50

MACD = $2.00