A trend exists when prices keep rising or falling over time. This is called directional price action. In an uptrend, each rally (upsurge) penetrates a higher price level than the prior rally, and each retracement (fall) stops above the level associated with the prior retracement. It's like a set of stairs at an angle.

MACD helps identify whether or not a stock trends. We feel it is far easier to make money by investing in stocks that trend versus stocks that do not trend.

The first assessment you should make of a stock is whether it's trending. A stock in an uptrend has a MACD indicator graph (the third graph from the top) where the centerline (0.0) is pushed down towards the bottom, or a MACD indicator graph where the centerline doesn't even exist (the bottom of the indicator graph is the centerline). It's in "positive ground."

The magnitude does not matter that much. What matters more is where the 0.0 line sits. Is it in the middle (a crapshoot)? Is it towards the top (downtrend) or is it at the bottom (uptrend)?

Take a look at the MACD graph for AOL. Do you see how the centerline is pushed to the bottom and how the red and blue lines soar above it? It's signaling an uptrend. Now look at the price graph and see how the soaring prices of the stock are echoing what the MACD graph was telling you. If you had picked up on AOL's uptrend when the latest MACD green trending bar was born (in early June), you would have made a timely entry into the stock and done well.