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MACD
MACD, short for moving average convergence divergence, is a chart indicator that tracks the gap between a faster and a slower moving average of price. It is drawn as a MACD line and a smoother signal line, and crossings between the two are read as shifts in momentum.
What it means for you. MACD is built entirely from past prices, so it describes momentum that has already happened and does not tell you what happens next. Because it is made of moving averages, it lags, and in choppy markets its crossovers can give several false signals in a row.
Sources: Deep et al.: Assessing the Impact of Technical Indicators on Machine Learning Models for Stock Price Prediction (arXiv, v1), Ma, Ventre and Polukarov: Denoised Labels for Financial Time-Series Data via Self-Supervised Learning (arXiv), Technical Analysis Meets Machine Learning: Bitcoin Evidence (arXiv) · checked 4 October 2026
Moving average
A moving average is the average of an asset's recent closing prices over a fixed number of periods, recalculated each period so the line moves along with the chart. It smooths out day-to-day swings to show the general direction prices have taken.
What it means for you. A moving average describes past prices and does not tell you what happens next. It always lags: by the time it turns, much of the move has happened. Crossover signals, where a short average crosses a long one, can flip back and forth in a sideways market, and each false signal can cost trading fees.
Sources: Deep et al.: Assessing the Impact of Technical Indicators on Machine Learning Models for Stock Price Prediction (arXiv, v1), Ma, Ventre and Polukarov: Denoised Labels for Financial Time-Series Data via Self-Supervised Learning (arXiv) · checked 4 October 2026