MACD consists of three components: the MACD line (12-period EMA minus 26-period EMA), the signal line (9-period EMA of MACD), and the histogram (difference between them).
When the MACD line crosses above the signal line, it is a bullish signal. When it crosses below, bearish. When the histogram bar grows larger above zero, upward momentum is accelerating.
The zero line is important context. A bullish MACD crossover above the zero line is a stronger signal than one below it. Crossovers below zero suggest the overall trend is still down, so bullish signals carry less weight.
MACD divergence is one of the most reliable signals: when price makes a new low but MACD does not, the downtrend is losing momentum and a reversal may be near. On StockifyX, toggle MACD on any stock chart to see all three components in a sub-chart.