MACD - Why is MT4's different?

I'm a bit confused with the moving average convergence divergence indicator right now. I don't quite understand what is going on as metatrader 4 has a version different to what i learned.

in metatrader 4, there is a signal line and a histogram, which confuses me a bit.

according to stockcharts (here), the macd has three parameters for a macd line, signal line, and a histogram plotted on a scale with 0 as the central line.

however, metatrader 4 only shows a signal line and a histogram as mentioned before.

my question is then how do i spot trend/ divergences in this case? what i noticed is that the histogram occasionally crosses above and below the signal line, and the price action moves accordingly, which i believe can help find trends.

does this mean that the macd line is integrated with histogram?

also, the signal line is a bit awkwardly worded for my interpretation. just wondering if anyone can tell me what the signal line means?

is my interpretation correct:

suppose there is a smooth moving average and an exponential moving average. i should place a buy order when the exponential ma crosses above the sma and sell when the ema crosses below the sma. suppose this is the case, is the signal line the "same idea" as the smooth moving average?

of course i know there can't be a comparison because the macd is the average of moving averages and the moving averages are based on a specified past price period, but is my interpretation roughly how the signal line works?

If you look at the bottom of the page at the similar threads, you will find all the answers. I remember reading about it before.

Hi,

You're correct about MT4's MACD. I posted about the differences between MT4's and the 'traditional' calculation here, and some more about the math behind the calculations here.

MT4 also has an indy called 'Moving Average of Oscillator', which if I recall correctly, uses a similar formula to the traditional MACD histogram.

I don't use MACD any more, but during the days when I was likewise interested in divergences, I wrote my own 4-color version that uses Gerald Appel's traditional formula. I've attached it for you.

David