The Moving Average Convergence Divergence (MACD) is a popular technical analysis tool used in financial markets to identify potential buy and sell signals. It consists of two moving averages: the short-term average and the long-term average. When the short-term average crosses above the long-term average, it may indicate a bullish trend, while a cross below may suggest a bearish trend. Traders often look at the MACD line and the signal line, which is a smoothed version of the MACD. The distance between these lines can indicate the strength of a trend. Additionally, the MACD histogram shows the difference between the MACD line and the signal line, providing further insights into market momentum.