Northspread
Formula sheet/NISM Series XV: Research Analyst/Technical Analysis
[ TECHNICAL ANALYSIS ]

Moving Average Convergence Divergence (MACD)

Fast MACD Line=EMA12(Price)−EMA26(Price)\text{Fast MACD Line} = EMA_{12}(Price) - EMA_{26}(Price)
Signal Line(Slow Line)=EMA9(Fast MACD Line)\text{Signal Line} (\text{Slow Line}) = EMA_{9}(\text{Fast MACD Line})
MACD Histogram=Fast MACD Line−Signal Line\text{MACD Histogram} = \text{Fast MACD Line} - \text{Signal Line}
Variables

Bullish crossover: Fast MACD crosses above Signal Line. Bearish divergence: Higher price high with lower MACD high.

Worked example
Relative Strength Index (RSI) Calculation

Over a 14-day lookback period, a stock's average daily gain on up-days is Rs 18.00 and its average daily loss on down-days is Rs 6.00. Calculate the Relative Strength (RS) and the 14-period RSI.