Trends/Momentum oscillators

MACD histogram

Bars showing the gap between the MACD line and its signal line.

Momentum oscillatorsBest on 3M, 6MAlso called MACD bars

Illustration of the MACD histogram shape. It is a sketch, not real price data.

What it shows

The histogram is MACD minus its signal line. Bars above zero mean MACD is above the signal. Bars below zero mean it is below. The bar height is the size of the gap.

Because it changes before the lines cross, the histogram shows when the gap is growing or shrinking.

How we find it

The same code that draws it on your chart follows these steps, with the same result every time.

Compute the MACD line and the signal line.
Histogram = MACD − signal.
Draw one bar per day: teal above zero, red below.
Compare each bar with the one before.

Starting values: Fast 12; Slow 26; Signal 9. These are proposed and will be tuned on real price data before launch.

How to read it

Teal bars are above zero. Red bars are below.
Taller bars mean a wider gap.
Shrinking bars mean the gap is closing.

Status labels you may see

Label	What it means
Growing	Bars have grown for 3 bars.
Shrinking	Bars have shrunk for 3 bars.
Near zero	Bar height under 5% of the recent max.

What cancels it

A bar crossing zero means the lines have crossed.

What traders check next

Whether bars are growing or shrinking.
How they compare with the recent peak.
The MACD line level.

Limits

Very noisy on short time frames.
A second derivative of price, so it lags and jumps.
Settings change the shape.

Try it in forecastviz

Open any ticker and choose Momentum oscillators → MACD histogram in the left menu.
Switch between 3M, 6M to see how the picture changes.
Compare with MACD and MACD divergence on the same chart.

Open on a ticker

Questions

What is it for?

To see the gap change before the lines cross.

Is a peak in the bars a signal?

It is a fact about the gap. No claim about what follows.