Signal Line
A moving average plotted alongside a technical indicator and is used to create transaction signals. Buy signals are generally created when the indicator crosses above the signal line, while sell signals are generated when the indicator crosses below it.
A signal line is also commonly known as a "trigger line." Investopedia Says:
The MACD indicator and the stochastics oscillator are the two most popular tools used in technical analysis that generate transaction signals by using a signal line. Most trigger lines are created by using a three- to nine-period moving average of the indicator values. Related Terms:
Crossover
Indicator
Moving Average
Moving Average Convergence Divergence - MACD
Stochastic Oscillator
Technical Analysis |