McGinley Dynamic Commodities Technical Analysis and 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 commodities trading market. Thus its name, dynamic.

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

Commodities Technical Analysis & How to Generate Trading Signals

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

Calculated using the formula:

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

D1 = previous value of Dynamic technical indicator

N = smoothing factor (of commodities trading price periods)

^ = Power of

Bullish, Buy Commodity Trading Signals & Bearish, Sell Trading Signals

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

• Bullish, Buy Commodity Signal - A buy commodity signal is generated when commodities trading price crosses above the indicator.
• Bearish, Sell Commodity Signal - A sell commodity signal is generated when commodities trading price crosses below the indicator.

Technical Analysis in Commodities Trading