Key Takeaways
- The MACD histogram shows the gap between the MACD line and the signal line as bars drawn above or below the zero line.
- The MACD histogram formula is the MACD line minus the signal line, using the default MACD settings of 12, 26 and 9.
- Bars above the zero line mean the MACD line is above the signal line, and bars below mean the MACD line is underneath.
- Growing bars mean momentum is building, while shrinking bars mean momentum is fading, often before a signal line crossover.
- A histogram cross above zero is a bullish signal line crossover, which is a different event from the MACD zero line crossover.
- MACD histogram divergence warns that momentum is weakening, but a divergence can last a long time before price turns, or price may never turn.
- On MT4 and MT5 the MACD window bars are the MACD line, and the built in OsMA indicator shows the true MACD histogram.
What Is the MACD Histogram?
The MACD histogram shows the distance between the MACD line and the signal line as bars above or below the zero line. Traders use the MACD histogram to measure momentum and to spot a coming signal line crossover before the two lines actually cross.
Thomas Aspray is credited with adding the histogram to MACD in 1986. Aspray wanted to anticipate crossovers, because a crossover between the MACD line and the signal line often comes well after price has turned.
The MACD histogram is built from three parts of MACD.
| Part | How It Is Calculated | What It Shows |
|---|---|---|
| MACD line | 12 period EMA minus 26 period EMA | Short term trend against longer term trend |
| Signal line | 9 period EMA of the MACD line | A smoothed MACD line used for crossovers |
| MACD histogram | MACD line minus signal line | Gap between the two lines, so momentum building or fading |
Each histogram bar is a simple subtraction, so reading the bars starts with knowing how the MACD line and the signal line are calculated.
How Is the MACD Histogram Calculated?
The MACD histogram is calculated by subtracting the signal line from the MACD line, so both lines have to be worked out first. The MACD line comes from two exponential moving averages (EMAs) of price, averages that give more weight to recent prices, and the signal line is an average of the MACD line.
MACD Histogram Formula
The MACD histogram formula is the MACD line minus the signal line. The full calculation takes three steps.
- MACD line = 12 period EMA − 26 period EMA
- Signal line = 9 period EMA of the MACD line
- MACD histogram = MACD line − signal line
The numbers 12, 26 and 9 are the default MACD settings, and this guide uses them throughout. A period is one candle, so on a daily chart the 12 period EMA averages the last 12 daily closes, with more weight on the most recent ones.
Because the histogram is a subtraction, the histogram is positive when the MACD line is above the signal line and negative when the MACD line is below the signal line.
MACD Histogram Calculation Example
A MACD histogram calculation example with three bars shows the histogram growing and then shrinking while the MACD line stays above the signal line.
| Bar | 12 EMA | 26 EMA | MACD Line | Signal Line | Histogram |
|---|---|---|---|---|---|
| 1 | 105.0 | 103.0 | 2.0 | 1.5 | 0.5 |
| 2 | 105.8 | 103.2 | 2.6 | 1.8 | 0.8 |
| 3 | 105.9 | 103.4 | 2.5 | 2.1 | 0.4 |
Illustration only. Made up round numbers, not a real market.
In bar 2, the MACD line pulls further away from the signal line, so the histogram grows from 0.5 to 0.8 and momentum is building. In bar 3, the signal line catches up, so the histogram shrinks to 0.4.
The 12 EMA in bar 3 is still the highest of the three bars, so price is still rising. The histogram shrinks anyway, because the MACD line is no longer pulling away from the signal line. In practice, momentum fading means an uptrend is slowing while price can still be going up.
Why the MACD Histogram Is Four Steps Removed From Price
The MACD histogram is four steps removed from price, because each step is built from the one before it.
- Price becomes a 12 period EMA and a 26 period EMA.
- The two EMAs become the MACD line.
- The MACD line becomes the signal line.
- The gap between the MACD line and the signal line becomes the histogram.
Every step smooths the data a little more, so the MACD histogram reacts after price has moved and does not predict price.
How to Read the MACD Histogram
Read the MACD histogram by which side of the zero line the bars are on and by whether the bars are growing or shrinking. The side of the zero line shows which line is on top, and the bar size shows whether momentum is building or fading. Side and size together give four bar states.
| Histogram Bars | What the Lines Are Doing | What It Suggests |
|---|---|---|
| Growing above the zero line | MACD line above the signal line and moving away | Upward momentum building |
| Shrinking above the zero line | MACD line above the signal line but getting closer | Upward momentum fading, a bearish signal line crossover may follow |
| Growing below the zero line | MACD line below the signal line and moving away | Downward momentum building |
| Shrinking below the zero line | MACD line below the signal line but getting closer | Downward momentum fading, a bullish signal line crossover may follow |
Positive and Negative Histogram Bars
Positive MACD histogram bars sit above the zero line and mean the MACD line is above the signal line, which points to upward momentum. Negative MACD histogram bars sit below the zero line and mean the MACD line is below the signal line, which points to downward momentum.
The side of the zero line only describes the two lines. A negative histogram does not mean price is falling or sits under any level on the chart, and price can still be rising while the bars are below the zero line.
Growing and Shrinking Histogram Bars
Growing MACD histogram bars mean the MACD line and the signal line are moving apart, so momentum is building in the direction of the bars. Shrinking histogram bars mean the two lines are getting closer, so momentum is fading, and a signal line crossover often follows.
Shrinking bars do not mean the trend has turned. Price can keep climbing for several bars while the histogram shrinks, because shrinking bars only show that the MACD line has stopped pulling away from the signal line.
Many platforms colour histogram bars green and red, but some also change the colour when bars start shrinking, so check what each colour means on your own chart.
Histogram Peaks and Troughs
A histogram peak is the tallest bar above the zero line before the bars start to shrink, and a histogram trough is the deepest bar below the zero line before the bars start to shrink. A peak or a trough shows momentum turning before the MACD line and the signal line actually cross.
Peaks and troughs give earlier warnings than a signal line crossover, because the bars start shrinking while the two lines are still apart. The same early timing is why peaks and troughs fail more often, since taller bars can return if the trend picks up again.
When the bars shrink all the way to the zero line, the MACD line and the signal line cross.
What Does It Mean When the MACD Histogram Crosses Above Zero?
When the MACD histogram crosses above zero, the MACD line has just crossed above the signal line, which is a bullish signal line crossover. When the MACD histogram crosses below zero, the MACD line has crossed below the signal line, which is a bearish signal line crossover. The histogram is exactly zero at the moment the two lines meet, because the histogram is the gap between them.
A histogram cross of zero is a different event from the MACD zero line crossover. In a MACD zero line crossover, the MACD line itself crosses the zero line, because the 12 period EMA has moved above or below the 26 period EMA. Mixing up the two crosses means reading a short term momentum signal as a slower trend signal.
| Event | What Crosses | What It Means |
|---|---|---|
| Histogram crosses above zero | MACD line crosses above the signal line | Bullish signal line crossover, short term momentum turning up |
| MACD zero line crossover | MACD line crosses above the zero line | 12 period EMA has moved above the 26 period EMA, a slower trend signal |
A histogram cross above zero is a momentum signal, and price can still fall after one. Because the signal line crossover is built from averages of averages, the cross often comes after much of the move has already happened.
Crossovers come late, which is why many traders also watch the histogram for divergence.
Types of MACD Histogram Divergence
MACD histogram divergence is when price and the histogram move in opposite directions, which is a sign that the momentum behind the trend is weakening. MACD histogram divergence comes in four types.
| Type | Price | Histogram | What It May Warn Of |
|---|---|---|---|
| Bullish divergence | Lower low | Higher low | Selling momentum fading, possible move up |
| Bearish divergence | Higher high | Lower high | Buying momentum fading, possible move down |
| Hidden bullish divergence | Higher low | Lower low | Uptrend may continue |
| Hidden bearish divergence | Lower high | Higher high | Downtrend may continue |
Bullish MACD Histogram Divergence
Bullish MACD histogram divergence happens when price makes a lower low while the histogram makes a higher low. Price is still falling, but the second dip in the histogram is shallower than the first, so selling momentum is fading.
Bullish divergence suggests price may turn up. Bullish divergence is never a guarantee, and in a strong downtrend price can keep making lower lows while the histogram keeps making higher lows.
Bearish MACD Histogram Divergence
Bearish MACD histogram divergence happens when price makes a higher high while the histogram makes a lower high. Price is still rising, but the second peak in the histogram is smaller than the first, so buying momentum is fading.
Bearish divergence suggests price may turn down. Bearish divergence is never a guarantee either, and in a strong uptrend price can keep making higher highs while the histogram keeps making lower highs.
Hidden MACD Histogram Divergence
Hidden bullish MACD histogram divergence happens when price makes a higher low while the histogram makes a lower low, which can point to an uptrend continuing. Hidden bearish divergence happens when price makes a lower high while the histogram makes a higher high, which can point to a downtrend continuing.
Regular divergence warns of a possible reversal, while hidden divergence warns of a possible continuation. Hidden divergence usually shows up during a pullback, when the histogram dips further than before but price holds above its last low.
Peak Trough and Slant MACD Histogram Divergence
A peak trough divergence has two clear peaks or two clear troughs on the MACD histogram, with the second one smaller than the first. A slant divergence has no clear second peak or trough, and the bars just slope steadily toward the zero line while price keeps moving the same way. Both shapes show the MACD line closing in on the signal line.
Divergences that build over a few weeks are generally more reliable than short, shallow divergences that form over a few days.
Before acting on any MACD histogram divergence, many traders wait for confirmation, such as a signal line crossover or price closing beyond a recent high or low.
MACD Histogram Signals in Trending and Ranging Markets
MACD histogram signals tend to be more useful in a trending market and much less reliable in a ranging market. In a trending market, signals that agree with the trend carry more weight. For example, price in an uptrend often pulls back for a few bars, and the histogram drops below the zero line during the pullback. When those bars start to shrink, selling momentum in the pullback is fading in the direction of the bigger uptrend.
A ranging market is a market where price moves sideways between a high and a low. In a ranging market, the histogram flips above and below the zero line again and again, and each flip is a signal line crossover that often leads nowhere. Signals that happen very close to the zero line are also weaker, because the MACD line and the signal line are barely apart.
Many traders use a moving average such as the 200 period moving average as a simple trend filter. When price is above the 200 period moving average, those traders give more weight to bullish histogram signals, and when price is below the 200 period moving average, more weight to bearish histogram signals.
Trend and range behaviour is the base of most MACD histogram strategies.
MACD Histogram Strategy
Most MACD histogram strategies are built on three setups.
- A trend pullback setup watches for histogram bars to turn back toward the zero line during a pullback in a trend.
- A divergence setup uses bullish divergence or bearish divergence, with a signal line crossover as confirmation.
- A breakout setup looks for a flat histogram near the zero line while price sits near support or resistance, followed by a breakout as the bars start to grow again.
Each MACD histogram setup needs its own rules for entry, stop loss and exit, and each setup fails in some markets. The full rules, worked examples and ways to combine MACD with other indicators are in the MACD trading strategy guide.
Limitations of the MACD Histogram
The MACD histogram has five main limitations that affect every signal it gives.
- The MACD histogram lags price because the histogram is built from moving averages, so the histogram reacts after price moves and never predicts price.
- The histogram gives false signals in a ranging market, where the bars flip around the zero line with no trend behind them.
- A MACD histogram divergence can last a long time before price turns, and sometimes price never turns at all.
- The histogram has no fixed overbought or oversold levels like the relative strength index (RSI) has, because histogram values depend on the price of the market.
- The histogram is not enough on its own, so traders confirm histogram signals with price or another tool and use a stop loss, an order that closes a trade at a set price, to limit the loss when a signal fails.
One more practical trap sits on MetaTrader, where the default MACD window does not show the histogram at all.
MACD Histogram on MT4 and MT5
On MetaTrader 4 (MT4) and MetaTrader 5 (MT5), the MACD window shows the MACD line as bars, and the Moving Average of Oscillator (OsMA) indicator shows the true MACD histogram. The MetaQuotes help pages for both platforms state that the MACD window draws the signal line as a dotted 9 period simple moving average (SMA) of the MACD line, in place of the usual EMA.
OsMA is built in on both platforms, under Insert, Indicators, Oscillators, and the steps for adding MACD are in the MACD trading strategy guide. OsMA plots the MACD line minus the signal line, which is the histogram explained in this guide. In a check on EUR/USD charts in MT4 and MT5 on 3 November 2026, the OsMA value matched the MACD line minus the signal line on each platform. Adding MACD and OsMA to the same chart shows every line in this guide. Because MetaTrader uses an SMA for the signal line, MetaTrader's signal line and OsMA values will differ slightly from platforms that use an EMA.
| Item | Most Charting Platforms | MT4 and MT5 Default MACD |
|---|---|---|
| What the bars show | MACD line minus signal line (histogram) | The MACD line itself |
| Signal line average | 9 period EMA | 9 period SMA, dotted line |
| Where to see the true histogram | Inside the MACD window | Add the Moving Average of Oscillator (OsMA) indicator |
FAQs
Is the MACD Histogram the Same as Trading Volume?
No, the MACD histogram is not trading volume. The MACD histogram shows the gap between the MACD line and the signal line, while volume shows how much of a market was traded in each period. Beginners mix the two up because both are drawn as bars under the price chart.
What Is the Difference Between the MACD Histogram and the MACD Line?
The MACD line is the 12 period EMA minus the 26 period EMA, while the MACD histogram is the MACD line minus the signal line.
Is the MACD Histogram a Leading or Lagging Indicator?
The MACD histogram is a lagging indicator, because the MACD histogram is built from moving averages of past prices. The histogram often turns before a signal line crossover, but every histogram signal still comes after price has moved.
What Are the Best MACD Histogram Settings?
The default MACD histogram settings are 12, 26 and 9, and no single setting is best for every market or timeframe. Faster settings make the histogram react sooner but give more false signals, and slower settings give fewer signals that arrive later. The MACD trading strategy guide covers other settings in more detail.
