McGinley Dynamic 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 technical indicator automatically/mechanically adjusting itself in relation to the speed of the market. Thus its name, dynamic.

The indicator follows trading price moves closely in both a fast and a slow moving market.

Trading Analysis and Generating Signals

This gold indicator is better at avoiding whipsaws compared to the initial moving average MA.

Calculated using the formula:

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

D1 = previous value of the Dynamic technical indicator

N = smoothing factor (of price periods)

^ = Power of

Bullish, Buy Signals & Bearish, Sell Trading Signals

McGinley Dynamic should be combined with moving averages to form a system. McGinley Dynamic should be used as the smoothing mechanisms where the Moving Average is choppy or range bound.

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

Analysis in XAU USD

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