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1992issue C111-2

Long-horizon MACD construction from paired exponential averages

A MACD-style oscillator can be built from two longer-horizon exponential averages. Convert the 33-week and 66-week lookbacks into explicit smoothing constants, seed the recursion, and check the faster-minus-slower difference cell by cell.

  • A MACD-style oscillator can be built from two longer-horizon exponential averages rather than a conventional short pair.
  • Smoothing constants of 0.0589 and 0.0299 are the exponential counterparts of 33-week and 66-week simple moving averages.
  • Each new exponential average equals the prior average plus the smoothing constant times the gap between the latest price and that prior average.
  • The oscillator is the 33-week exponential average minus the 66-week exponential average and can be checked by subtracting those two worksheet columns.
Entries in this reading3 entries
Current trackMACD115 readingsExponential smoothing117 readingsMoving average449 readings

A longer pair instead of a short one

A MACD-style oscillator can be built from two longer-horizon exponential averages rather than a conventional short pair. MACD is a chart signal formed as the difference between a faster and a slower moving-average pair, used here to mark how two exponential tracks converge or diverge.

A moving average is a lookback smoother specified either as a simple window length or as an exponential stand-in for that window. The simple windows in this construction are 33 weeks and 66 weeks.

Convert lookbacks into smoothing constants

A smoothing constant of 0.0589 is used as the exponential counterpart of a 33-week simple moving average. A smoothing constant of 0.0299 is used as the exponential counterpart of a 66-week simple moving average.

A smoothing constant is the weight applied to the latest price-minus-average residual when an exponential level is updated. Exponential smoothing is a recursive update that folds the latest observation into the prior level with a fixed smoothing constant.

Update the recursion and seed the first value

Each new exponential average equals the prior average plus the smoothing constant times the gap between the latest price and that prior average.

Initialization is the seed rule used when no prior exponential value exists. When no prior exponential value exists, the recursion can begin on the second observation by seeding the first average with the previous close.

Form the oscillator from the two averages

The oscillator value is the 33-week exponential average minus the 66-week exponential average.

Check the construction in a worksheet

The same construction can be checked in a worksheet by keeping each exponential average in its own column and subtracting those columns.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
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19931-9 pp.Next on MACDConstructing a signed ten-point trend filterA trend-filter is a discrete signed rating: score plus one when the current close is at or above a lagged close, minus one when it is below, then sum ten comparisons so the total lies between plus ten and minus ten.
All readings on this track · 80 readings
  1. 1988Rebuild MACD-Mo and MACD-H before treating them as signals
  2. 1989Four-span MACD lookbacks as perishable parameters
  3. 1989Weekly then daily MACD confirmation on individual stocks
  4. 1991Regime-gated MACD and stochastic rules inside a checklist
  5. 1991Constructing MACD signal lines and divergence tests
  6. 1991MACD parameter order and cycle phase lag
  7. 1992Lengthened bond MACD as an equity regime filter
  8. 1992Long-horizon MACD construction from paired exponential averages
  9. 1993Constructing a signed ten-point trend filter
  10. 1994Constructing lag-reduced double exponential averages for MACD
  11. 1994Seeding DEMA2 filters to build a MACD signal
  12. 1994Constructing MACD from lag-reduced exponential averages
  13. 1994TEMA1 from nested exponential averages, then a two-horizon MACD
  14. 1994Constructing entry and exit on a relative-strength MACD
  15. 1994Constructing a relative-strength MACD crossover spreadsheet
  16. 1995Consensus presignal filters for Relative Strength Index, MACD and the Stochastic oscillator
  17. 1997Confirm the MACD turn with price, then exit on the histogram
  18. 1997Reconstructing a stochastic oscillator, MACD, and a triple-smoothed oscillator
  19. 1997Moving-average windows before crossovers and MACD
  20. 1999Second-stage MACD on relative-strength inputs
  21. 1999Constructing MACD from exponential-average spreads for crossover and divergence
  22. 1999Coding candlesticks into numeric indicators
  23. 2001Second-low confirmation with a percentage oscillator and money-flow filter
  24. 2001Constructing MACD from exponential average spreads and a signal line
  25. 2002Separate bounded and trend-following oscillator rules
  26. 2002Sort the regime before assigning MACD and stochastic jobs
  27. 2002Building classic divergence filters from RSI and MACD
  28. 2002Weekly highs and lows as trend gates
  29. 2002Constructing channel-normalized Fisher reversal signals
  30. 2002Affine-price and the Fisher transform as a constructed companion to MACD
  31. 2003Regularized EMA construction with a MACD line and a thrust oscillator
  32. 2003Curvature-penalized exponential averages versus MACD
  33. 2003MACD, moving averages, and a trend filter as one timing system
  34. 2003Fractional MACD and linear-regression reversal construction
  35. 2004Weekly MACD-histogram timing of bear-market rallies
  36. 2004Candlestick triggers filtered by MACD divergence
  37. 2004Staging energy-complex tops with trendline, breakout, and MACD
  38. 2005Selling climax holds versus fails
  39. 2006Treat a sideways Wave as permission before a breakout
  40. 2007MACD with a Stochastic oscillator for spotting trend reversals
  41. 2007Rebuilding an S&P 500 fifth-wave count after a broken target
  42. 2007Constructing MACD, RSI, and stochastic confirmation for futures
  43. 2007MACD histogram divergence needs a confirming close
  44. 2007Write the plan as a stack: ratio, boundary, then oscillators
  45. 2008MACD divergence and Stochastic oscillator confirmation on lumber futures
  46. 2008Assign confirmation, timing, and a stop before a currency pair is tested
  47. 2008Confirm the ten-bagger launch path before the MACD exit
  48. 2008Reading the offloaded evidence file
  49. 2008A Leader companion for MACD direction warnings
  50. 2008Relative strength exits with MACD averages and RSI
  51. 2008Assign one job per indicator in a three-screens rule set
  52. 2008Sequencing RSI, MACD, and average crossovers
  53. 2010Constructing the Schaff Trend Cycle from MACD and a dominant-cycle window
  54. 2010Schaff Trend Cycle as a MACD and Stochastic oscillator combination
  55. 2010Combining Relative Strength Index, the stochastic oscillator, and MACD as slope filters
  56. 2010Short-term wave and ratio clues without direction calls
  57. 2010A precise pullback entry and an unplanned profit-protection exit
  58. 2010Filtering MACD false signals with trendline breaks
  59. 2011Vendor feeds as an input variable in a MACD evaluation
  60. 2012Out-of-the-money versus in-the-money option sensitivity to implied volatility
  61. 2012MACD window tuning as hold-time control
  62. 2012Combining a moving-average crossover with MACD and support-resistance
  63. 2012Testing a published MACD entry with a histogram and signal-line agreement filter
  64. 2012Treat sample systems as a lab before live rules
  65. 2013Constructing moving averages and MACD from one price series
  66. 2013The next-bar price that forces a MACD signal-line cross
  67. 2013Constructing next-bar MACD reversal prices
  68. 2013Constructing inverted MACD reversal prices
  69. 2014Shared-filter combinations of the stochastic oscillator, MACD, and RSI
  70. 2014Square-root lookbacks for combined MACD and RSI
  71. 2015Audit open interest and trend before trusting oscillator crossovers
  72. 2016MACD without a signal line, confirmed by moving-average trend filters
  73. 2016Use RSI, MACD, and a moving average as a market-health consensus
  74. 2016MACD line versus histogram is a display problem first
  75. 2017Weekly and daily MACD on a single daily chart
  76. 2017Weekly and daily MACD as a stacked momentum filter
  77. 2017Nested weekly and daily MACD from paired EMA spreads
  78. 2018Weekly and daily PPO scale versus MACD, with bounded RSI and stochastic readings
  79. 2018Constructing a weekly and daily percentage price oscillator
  80. 2020Constructing Wyckoff tape reading with MACD, moving-average, and RSI filters
By fieldIndicators and filters682 readingsBy year1992115 readings
All 115 readings tagged MACD
Also on MACD5 readings
1991MACD parameter order and cycle phase lag1994Constructing lag-reduced double exponential averages for MACD1994Constructing MACD from lag-reduced exponential averages1994TEMA1 from nested exponential averages, then a two-horizon MACD2001Second-low confirmation with a percentage oscillator and money-flow filter