With MACD you need to set three parameters:
- Period of the shorter EMA of price;
- Period of the longer EMA of price;
- Period of the EMA of MACD, used for the Signal line.
Popular MACD Settings
The most widely used values for these three are: 12, 26, 9:
- 12 for Short EMA of price;
- 26 for Long EMA of price;
- 9 for the EMA of MACD.
This is what you will most likely find as default in your charting software.
Best MACD Settings
People often ask which particular MACD settings are the best / most profitable. The answer can’t be anything else than: It depends – on the market you are analyzing or trading with the MACD, your time horizon, and trading style. However, changing the 3 MACD parameters does generally not play very significant role (unless you change it to something like 3, 100, and 40 of course).
Sensitivity of MACD to Different Settings
Changing the difference, or rather the ratio of the first two parameters (longer and shorter price EMA period) usually has the biggest impact on the looks of the MACD, as it directly affects the behaviour of the distance between the two exponential moving averages (the MACD line value). The greater the difference between the two periods, the more volatile the MACD will look.
Try Different MACD Settings and See Lots of Charts
The best way how to become familiar with MACD and its looks and behaviour with different settings and in different market environments is to spend some time playing with it, changing the settings, and looking at lots of charts.