A method for detection of passing magnetic articles which includes an initial step of sensing an ambient magnetic field and generating a voltage, Vsig, proportional to the magnetic field. A threshold voltage is generated as a percentage of the peak-to-peak voltage of Vsig. The method further includes the step of generating a detector output voltage that becomes one binary level when Vsig rises to exceed the threshold voltage and another binary level when Vsig falls to below the threshold voltage. The threshold voltage is updated to track the positive and negative peaks of the Vsig voltage and is further updated by a predetermined amount upon each transition of the Vout voltage.