McGinley Dynamic Indices Technical Analysis & McGinley Dynamic Trading Signals
Developed by John McGinley
McGinley Dynamic aims to overcome the lag of the traditional simple and exponential moving averages, the indicator automatically adjusting itself relative to the speed of the stock indices market. Thus its name, dynamic.
The indicator follows stock indices price movements closely in both a fast and a slow moving stock indices market.
Stock Indices Technical Analysis & How to Generate Signals
This stock indices technical indicator is better at avoiding whipsaws compared to the original moving average.
Calculated using the formula:
Dynamic = D1 + (Indices Price - D1) / (N * (Indices Price/D1)^4)
D1 = previous value of Dynamic technical indicator
N = smoothing factor (of stock indices price periods)
^ = Power of
Bullish, Buy Indices Trading Signals & Bearish, Sell Trading Signals
McGinley Dynamic should be combined with moving averages to form a trading system. McGinley Dynamic should be used as the smoothing mechanisms where the moving average is choppy or ranging.
- Bullish, Buy Indices Trading Signal - A buy stock indices signal is generated when stock indices price is crosses above the indicator.
- Bearish, Sell Indices Trading Signal - A sell stock indices signal is generated when stock indices price is crosses below the indicator.
Technical Analysis in Stock Indices Trading
