McGinley Dynamic Stock Analysis & McGinley Dynamic Trading 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 stocks market. Thus its name, dynamic.

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

Stock Trading Analysis & Generating Trading Signals

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

Calculated using the formula:

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

D1 = previous value of Dynamic technical indicator

N = smoothing factor (of stocks price periods)

^ = Power of

Bullish, Buy Stocks Signals and 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 Stock Trading Signal - A buy stock signal is generated when stocks price is crosses above the indicator.
• Bearish, Sell Stock Trading Signal - A sell stock signal is generated when stocks price is crosses below the indicator.

Technical Analysis in Stock Trading