Trigger Line

A A A

DEFINITION

A moving-average line found in the moving average convergence divergence (MACD) theory, which is used to signal buy or sell points for a security. The trigger line interacts with the two moving averages that form the MACD line and attempts to predict upcoming trends.

INVESTOPEDIA EXPLAINS

The trigger line provides traders with technical insight on when to long or short a stock. A common use of the trigger line is found in crossovers. When the trigger line crosses above the MACD line, a buy signal is sent, indicating that a trader should purchase the stock. Inversely, the trigger falling below the MACD represents a bearish trend, where the trader should short the stock.


RELATED TERMS
  1. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth out price action ...
  2. False Signal

    In technical analysis, a false signal refers to an indication of future price ...
  3. Trade Signal

    A sign, usually based on technical indicators, that it is a good time to buy ...
  4. Crossover

    The point on a stock chart when a security and an indicator intersect. Crossovers ...
  5. Moving Average Convergence Divergence ...

    A trend-following momentum indicator that shows the relationship between two ...
  6. Technical Analysis

    A method of evaluating securities by analyzing statistics generated by market ...
  7. Technical Indicator

    Any class of metrics whose value is derived from generic price activity in a ...
  8. Mass Index

    A form of technical analysis that looks at the range between high and low stock ...
  9. Money Flow Index - MFI

    A momentum indicator that uses a stock’s price and volume to predict the reliability ...
  10. On-Balance Volume (OBV)

    A momentum indicator that uses volume flow to predict changes in the stock price. ...
Related Articles
  1. MACD Histogram Helps Determine Trend ...
    Trading Strategies

    MACD Histogram Helps Determine Trend ...

  2. A Primer On The MACD
    Technical Indicators

    A Primer On The MACD

  3. Momentum Trading With Discipline
    Trading Strategies

    Momentum Trading With Discipline

  4. Using Pivot Points For Predictions
    Technical Indicators

    Using Pivot Points For Predictions

  5. Trading The MACD Divergence
    Forex Education

    Trading The MACD Divergence

  6. Introduction to Types of Trading: Technical ...
    Forex Education

    Introduction to Types of Trading: Technical ...

  7. Add Some Sin To Your Portfolio With ...
    Chart Advisor

    Add Some Sin To Your Portfolio With ...

  8. Finding The Trend With Aroon
    Active Trading

    Finding The Trend With Aroon

  9. Are These Battered Stocks Making A Turnaround?
    Chart Advisor

    Are These Battered Stocks Making A Turnaround?

  10. Oil Chart Suggests That Now Is The Time ...
    Chart Advisor

    Oil Chart Suggests That Now Is The Time ...

comments powered by Disqus
Hot Definitions
  1. Pension Risk Transfer

    When a defined benefit pension provider offloads some or all of the plan’s risk – e.g.: retirement payment liabilities to former employee beneficiaries. The plan sponsor can do this by offering vested plan participants a lump-sum payment to voluntarily leave the plan, or by negotiating with an insurance company to take on the responsibility for paying benefits.
  2. XW

    A symbol used to signify that a security is trading ex-warrant. XW is one of many alphabetic qualifiers that act as a shorthand to tell investors key information about a specific security in a stock quote. These qualifiers should not be confused with ticker symbols, some of which, like qualifiers, are just one or two letters.
  3. Quanto Swap

    A swap with varying combinations of interest rate, currency and equity swap features, where payments are based on the movement of two different countries' interest rates. This is also referred to as a differential or "diff" swap.
  4. Genuine Progress Indicator - GPI

    A metric used to measure the economic growth of a country. It is often considered as a replacement to the more well known gross domestic product (GDP) economic indicator. The GPI indicator takes everything the GDP uses into account, but also adds other figures that represent the cost of the negative effects related to economic activity (such as the cost of crime, cost of ozone depletion and cost of resource depletion, among others).
  5. Accelerated Share Repurchase - ASR

    A specific method by which corporations can repurchase outstanding shares of their stock. The accelerated share repurchase (ASR) is usually accomplished by the corporation purchasing shares of its stock from an investment bank. The investment bank borrows the shares from clients or share lenders and sells them to the company.
  6. Microeconomic Pricing Model

    A model of the way prices are set within a market for a given good. According to this model, prices are set based on the balance of supply and demand in the market. In general, profit incentives are said to resemble an "invisible hand" that guides competing participants to an equilibrium price. The demand curve in this model is determined by consumers attempting to maximize their utility, given their budget.
Trading Center