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MACD is used to spot price divergences at tops and bottoms. It is composed of two lines (MACCD line and signal line) and a histogram. When the MACD line is above the signal line, the histogram is positive (crosses above 0 into positive territory) and this is a buy signal. When the MACD line crosses below the signal line, the histogram is negative (crosses below 0 and into negative territory) and this is a sell signal. On its own, the MACD does not give reliable signals and it must be combined with other indicators to produce a reliable signal.

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