McGinley Dynamic
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McGinley Dynamic is an indicator which is used similar to a moving average. The indicator is developed by John McGinley in 1990.
Contents |
Formula
McGinley Dynamic indicator is calculated by the formula:
where
is the current McGinley Dynamic;
is the previous McGinley Dynamic;
is a constant equaled to 0.6 (60% of a selected moving average period N);
is the moving average period;
is the closing price.
Usage
In Place of Simple Moving Average
McGinley Dynamic indicator may be used exactly as Simple Moving Average or Exponential Moving Average.
Compare 12-periods McGinley Dynamic and Simple Moving Average (MVA) applied on the same prices:
Behavior Comparing Moving Averages
Unlike moving averages such as Simple Moving Average or Exponential Moving Average, McGinley Dynamic avoids of most whipsaws and it rapidly moves up or down according to a quickly changing market. It needs no adjusting because it is dynamic and it adjusts itself.
See Also
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