McGinley Dynamic Oil Technical 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 crude oil market. Thus its name, dynamic.

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

Crude Oil Technical Analysis and Generating Trading Signals

This oil technical indicator is better at avoiding whip-saws compared to the original moving average.

Calculated using the formula:

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

D1 = previous value of Dynamic technical indicator

N = smoothing factor (of crude trading price periods)

^ = Power of

Bullish, Buy Oil Signals and Bearish, Sell Trading Signals

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

• Bullish, Buy Oil Signal - A buy oil signal is generated when crude trading price crosses above the indicator.
• Bearish, Sell Oil Signal - A sell oil signal is generated when crude trading price crosses below the indicator.

Technical Analysis in Crude Trading