McGinley Dynamic Oil Technical Analysis and 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 oil price movements closely in both a fast and a slow moving oil market.

Oil Technical Analysis & How to Generate Trading Signals

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

Calculated using the formula:

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

D1 = previous value of Dynamic technical indicator

N = smoothing factor (of crude oil price periods)

^ = Power of

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

Technical Analysis in Oil Trading