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2014issue C0959-60

Square-root lookbacks for combined MACD and RSI

A daily Dow Jones Industrial Average chart from September 2013 through February 2014 displayed MACD and RSI built from square-root operations on the index. Periods came from price-derived iterations, and difference-line action, signal-line crosses, and dual RSI crosses were the marks shown for a short swing.

  • Successive square-root iterations of one index supplied the lookback lengths for both MACD and two overlaid RSI lines.
  • The MACD difference subtracted the second-iteration slow average from the third-iteration fast average, and the signal line smoothed that difference with the fourth iteration.
  • Both RSI lines read the first-iteration series and differed only by whether the second or third iteration set the period.
  • Levels, turns, and crosses, including stretches with no dual RSI cross, were presented as the marks of a short swing, without a multi-year extraction of net point results.
Entries in this reading2 entries
Current trackMACD115 readingsRelative Strength Index186 readings

What the daily chart displayed

A daily Dow Jones Industrial Average chart from September 2013 through February 2014 displayed both MACD and RSI built from square-root operations on the index.

Square-root-iteration names a repeated square-root transform of a price series used to produce a lookback or smoothing length for an indicator. Those iterations set the time elements for both tools on the same chart.

MACD lengths from later iterations

The MACD slow average used the second square-root-iteration and the fast average used the third. The macd-difference was the fast result minus the slow result after both averages received those iteration-based lengths.

The signal-line was a moving average of that macd-difference. Its length came from the fourth square-root-iteration.

Two RSI lines on one series

A dual-rsi-overlay placed two relative-strength calculations on one series. The first square-root-iteration was the data input, the second iteration set the slower RSI, and the third iteration set the faster RSI.

The two RSI lines therefore differed only by which iteration set each period.

Periods taken from price

Indicator periods were taken from numbers derived from price. That is price-derived-periodicity: choosing indicator time elements from numbers computed from price instead of from a fixed calendar default.

Those periods were described as related to, but not the same as, fully pairing price with time.

Marks on a short swing

Difference-line levels and turns, signal-line crosses, and dual-rsi-overlay crosses were presented as the observable marks for a short swing. Those marks included stretches with no dual-RSI cross.

No multi-year extraction of net point results for the construction was reported.

DJIA with square-root MACD and dual RSI

From late December 2013 through mid-February 2014 the daily Dow swings while the square-root MACD difference and signal lines turn together, and the fast (pink) and slow (blue) RSI lines cross on the same price-derived lookbacks. Values were read off the plotted daily chart, not from a table.
From late December 2013 through mid-February 2014 the daily Dow swings while the square-root MACD difference and signal lines turn together, and the fast (pink) and slow (blue) RSI lines cross on the same price-derived lookbacks. Values were read off the plotted daily chart, not from a table.DJIA · daily · 2013-12-30T00:00:00.000Z to 2014-02-18T00:00:00.000Z

MACD uses later square-root iterations for the fast, slow, and signal averages; both RSI lines are built from the first three iterations of the same price series. Dates and oscillator readings are approximate because they were taken from the raster.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
70 of 80 in the MACD track
201545-47 pp.Next on MACDAudit open interest and trend before trusting oscillator crossoversEarly rises and late declines in one delivery month’s volume and open interest come from the contract’s limited life and do not, by themselves, indicate market direction.
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 year201489 readings
All 115 readings tagged MACD
Also on MACD5 readings
1995Consensus presignal filters for Relative Strength Index, MACD and the Stochastic oscillator1999Coding candlesticks into numeric indicators1999Second-stage MACD on relative-strength inputs2002Building classic divergence filters from RSI and MACD2002Constructing channel-normalized Fisher reversal signals