A Parameterized MACD Variant with Smoothed Lines and Crossover Markers

Summary

This indicator modifies the moving average convergence divergence calculation by applying a second moving average to each short and long series, then adding the resulting difference back to the first average. The difference between these adjusted short and long series forms the modified MACD line. A signal line is created by smoothing that value twice and adding the second smoothing difference, producing another adjusted series. The indicator plots both lines, a zero reference, and highlights their crossovers with markers and colors.

The parameters for the averaging periods and methods can be changed, but the document does not specify a tested set of values, market, timeframe, or entry and exit rules. It offers no backtest or evidence that the revised calculations improve on a conventional MACD. The code is therefore a configurable indicator description rather than a validated trading strategy; users would need to define how signals are interpreted and test them against suitable data and execution assumptions.

Key ideas

• The modified MACD applies a second moving average to both short and long price averages.
• It adds each smoothing difference back to its first average before calculating the main line.
• The signal line is also smoothed twice and adjusted using the difference between its smoothing stages.
• Crossover markers and color changes help visualize line relationships, but the document supplies no strategy validation.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.