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McGinley Dynamic Stock Indices Technical Analysis and McGinley Dynamic Stock Indices 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 index trading market. Thus its name, dynamic.


The indicator follows stock index price movements closely in both a fast and a slow moving stock index trading market.

McGinley Dynamic Technical Stock Indices Indicator



Stock Indices Technical Analysis and Generating Stock Indices Signals


This 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 indicator

N = smoothing factor (of stock index price periods)

^ = Power of


Bullish, Buy Stock Indices Signals and Bearish, Sell Stock Indices Signals


McGinley Dynamic should be combined with moving averages to form a stock index trading system. McGinley Dynamic should be used as the smoothing mechanisms where the moving average is choppy or ranging.



  • Bullish, Buy Stock Indices Signal - A buy stock indices signal is generated when stock index price crosses above the indicator.

  • Bearish, Sell Stock Indices Signal - A sell stock indices signal is generated when stock index price crosses below the indicator.

McGinley Dynamic Technical Stock Indices Indicator

Technical Analysis

 

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