Home    |    Trading Alchemy Manual    |    Alchemy Functions Index

AlchemyMCD (Function)

AlchemyMCD returns the difference between a fast and slow exponential moving average based on the same Price, using either number of trailing bars or a smoothing factor percentage.

AlchemyMCD (FirstBar, FstPrice, FaLength, FaFactor, SloPrice, SlLength, SlFactor)

Parameters

FirstBar

Specifies the bar number of the first bar calculated

FstPrice

Specifies which price of the asset to be used for the fast average.

FaLength

Number of trailing bars to consider for the fast average. 0 uses the smoothing factor determined in FaFactor.

FaFactor

Smoothing factor percentage to consider for the fast average. 0 uses number of trailing bars determined in FaLength.

SloPrice

Specifies which price of the asset to be used for the slow average.

SlLength

Number of trailing bars to consider for the slow average. 0 uses the smoothing factor determined in SlFactor.

SlFactor

Smoothing factor percentage to consider for the slow average. 0 uses number of trailing bars determined in SlLength.

Returns

A numeric value containing MCD for the current bar.

Usage

During rising markets, the fast period moving average will rise faster than the slow period moving average resulting in a rising differential line or a larger value. The idea is that with a smaller number of bars used in its calculation, the fast period moving average will more quickly indicate the trend of the most recent data.
When the fast period moving average crosses above or crosses below the slow period moving average, a signal is generated. Once the lines cross, it becomes important to look at the distance between them. The MCD function returns that difference. When the fast period moving average is above the slow period moving average, the MCD is positive and when it is below the slow period moving average the MCD is negative.

Home    |    Trading Alchemy Manual    |    Alchemy Functions Index