McGinley Dynamic Technical Analysis & McGinley Dynamic Signals

Developed by John McGinley

McGinley Dynamic aims to overcome the lag of the traditional simple & exponential moving averages, the indicator automatically adjusting itself relative to the speed of the market. Thus its name, dynamic.

The indicator follows trading price movements closely in both a fast & a slow moving market.

Technical Analysis and How to Generate Trade Signals

This technical indicator is better at avoiding whipsaws compared to the original moving average.

Calculated using the formula:

Dynamic = D1 + (Price - D1) / (N * (Price/D1)^4)

D1 = previous value of Dynamic indicator

N = smoothing factor (of trading price periods)

^ = Power of

Bullish, Buy Signals & Bearish, Sell Signals

McGinley Dynamic should be combined with MAs to form a trading system. McGinley Dynamic should be used as the smoothing mechanisms where the Moving Average is choppy or ranging.

• Bullish, Buy Signal - A buy signal gets generated when price crosses above the indicator.
• Bearish, Sell Signal - A sell signal gets generated when price crosses below the indicator.

Technical Analysis in XAUUSD Trading