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1988issue C081-7

Weekly MACD as a two-clock momentum confirmation stack

Weekly MACD crossovers were treated as lagging, so a smoothed momentum of the MACD histogram was added to anticipate them. In editorial terms, histogram polarity states the regime, MACD-Mo times the hypothesis, and price-indicator divergence is the conflict check that keeps a zero-line event falsifiable.

  • Weekly MACD crossovers were treated as lagging, so MACD-Mo was added to anticipate those crossovers rather than wait for them.
  • Read MACD-Mo direction first, then treat a zero-line event as a new signal hypothesis that still needs MACD-H confirmation.
  • In a strong trend, a MACD-Mo reversal is an early-warning layer, not a standalone trigger.
  • Divergence is the veto when price makes a new high or low that MACD-H or MACD-Mo fails to confirm.
Entries in this reading3 entries
Current trackMomentum strategy103 readingsMACD115 readingsPrice-indicator divergence142 readings

Why a second clock was added

Weekly MACD crossovers were treated as lagging. A smoothed momentum of the MACD histogram was added specifically to anticipate those crossovers.

MACD is a two-average price oscillator whose histogram form, MACD-H, is read as polarity above or below zero. Weekly MACD-H was specified as 10- and 20-period averages with a 10-period exponential average of the difference. MACD-Mo is a 10-period momentum of that histogram with 3-period smoothing.

How the histogram is read

The histogram is read in two steps. The direction of MACD-Mo is read first. Zero-line crosses are then treated as new signals. Extreme readings are interpreted only relative to whether MACD-H is positive or negative.

A zero-line event is a cross of MACD-H or MACD-Mo through zero. The stack treats that event as a new signal hypothesis, not a standalone order.

What the weekly examples showed

On the weekly T-bond sequence, MACD-Mo crossed above zero one week before the MACD-H buy-mode crossing. Positive divergences appeared on retests of lows before the histogram improved.

In strong trends, MACD-Mo often reversed well before price. The procedure treats that turn as an early-warning layer rather than a standalone trigger.

On the later weekly T-bond continuation, both series were already negative on a rebound into resistance. A later recovery high in price coincided with a lower MACD-Mo high and a delayed MACD-H sell-mode crossing.

On weekly S&P charts, a rising price trend against a falling MACD-Mo line, and later a series of higher MACD-Mo lows against declining prices, were used as divergence filters around subsequent zero-line events. Divergence, in this stack, is a conflict in which price makes a new high or low that MACD-H or MACD-Mo fails to confirm.

On weekly crude, a defined short-side hypothesis was MACD-Mo rallying and then peaking while MACD-H stayed negative. Long-side alignment required MACD-Mo through zero with a later MACD-H buy-mode crossing.

One momentum-timing procedure

The combined rule set treats optimized MACD-H polarity and MACD-Mo direction as one momentum-timing procedure. In this stack, a momentum strategy is one procedure that times entry, exit, and abstention from MACD-Mo slope, zero-line events, and MACD-H confirmation together.

The archive described that procedure as applicable to weekly stock and commodity series. Daily-bar behavior was left for a later test.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
3 of 51 in the Momentum strategy track
19891-7 pp.Next on Momentum strategyEqual-weight zero-cross from smoothed spreadsEach of the four inputs is normalized to a 0-to-100 scale from its own minimum-to-maximum range before any residual is taken.
All readings on this track · 51 readings
  1. 1984Half-cycle differencing for momentum signals
  2. 1987Relative strength evaluation under competing optimization criteria
  3. 1988Weekly MACD as a two-clock momentum confirmation stack
  4. 1989Equal-weight zero-cross from smoothed spreads
  5. 1989Testing relative-strength-index reversal rules against trend continuation
  6. 1989Smoothed three-day futures filter for index option bounces
  7. 1989Cycle-length windows for momentum, Relative Strength Index, and stochastic construction
  8. 1991Filtered rally magnitude as a bull-regime breakout
  9. 1992Constructing true strength from double-smoothed momentum
  10. 1992Constructing a double-smoothed true strength index
  11. 1993When momentum structure and breadth break together
  12. 1993Constructing double-smoothed range and momentum oscillators
  13. 1993Constructing a two-parameter relative momentum index
  14. 1993Building a bounded momentum oscillator with RSI smoothing
  15. 1993Two-speed oscillators with divergence and trendline gates
  16. 1993Constructing a relative momentum index from the relative strength index
  17. 1994Constructing daily advance-decline breadth tools
  18. 1994Building a composite regime score from monetary climate and weekly trend
  19. 1994Averaging Relative Strength Index and the stochastic oscillator into one reversal oscillator
  20. 1995Dividend-yield regression as a hold versus momentum gate
  21. 1996Jump and hold filters for long-term Treasury yield direction
  22. 1997Constructing extendedness from a 10 percent swing filter
  23. 1997A range-expansion oscillator that can refuse its own stretch
  24. 1997RSI trend permission and Fibonacci pullback rules
  25. 1998Nested midpoint construction for a range-normalized oscillator
  26. 1999Evaluating Relative Strength Index momentum with zero-line and threshold rules
  27. 1999Treat RSI and momentum as three mechanical procedures
  28. 2000Thrust strength figure from moving-average swings
  29. 2001Constructing a non-range-bound balance of market power score
  30. 2004Cleaned breadth oscillator and new-high divergence: a swing-market case file
  31. 2004Evaluating advance-issues-momentum on a fixed-symbol-basket
  32. 2004Constructing a trend filter from two adjacent high-low windows
  33. 2006A dollar-versus-commodity extreme as a regime case
  34. 2008Zero-centered stochastic bands and bracket stops
  35. 2012Evaluating engulfing momentum across hold windows
  36. 2012Staged stops as one mechanical entry and exit procedure
  37. 2012Stacking a relative-strength-index forecast, a trend filter, and long-only momentum
  38. 2013Constructing fair-value filters from averages and momentum
  39. 2014Constructing a multi-window slope divergence entry
  40. 2015Bandedge trend filter construction with inverse crossover rules
  41. 2017Opposite rules for index price and volatility momentum
  42. 2018A three-state overlay that colors a trend only after the line clears the bar
  43. 2018Half-cycle relative-strength index with a Fisher map for cyclic reversals
  44. 2018Emotion as a rule input when momentum breaks
  45. 2018Two-bar body expansion as a momentum breakout construction
  46. 2019Pair a two-day high breakout with a volume-weighted exit on the same chart
  47. 2020Building reflex and trendflex cross and extreme entry rules
  48. 2020Construct a dual-series price momentum oscillator overlay
  49. 2020A multi-timeframe stochastic as a panel of weekly voters
  50. 2020Centerline crossovers that compare index momentums
  51. 2020Multi-timeframe stochastic voting as one mechanical rule
By fieldIndicators and filters682 readingsBy year198866 readings
All 103 readings tagged Momentum strategy
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