# Awesome Oscillator

How Awesome Oscillator works

The Awesome Oscillator is useful to traders as it produces the following trade signals:

1. A sell position if the AO goes below the zero line and forms a peak;

A buy position if the AO goes above the zero line and forms a gap

1. A sell position if the AO creates 2 peaks above the zero line in which the second peak is lower than the first peak;

A buy position if the AO frames two lows below zero with the second low not below than the first one.

1. A sell position if the AO crosses the zero line from up going down;

A buy position if the AO crosses the zero line from down going up.

Awesome Oscillator’s mechanism projects three main signals. These are:

1. Saucer – This signal is characterized by forming three columns over the nought line: 2 color red columns and 1 green column. Between the first two red columns, the second one is usually lower than the first red column. The green column goes higher than the second red column. When a saucer is projected, it indicates a ‘buy’ signal, while an inverted version of this formation indicates a ‘sell’ signal.
2. Nought Line Cross – This formation is observed when the histogram crosses the nought line taking the upward direction which signifies a change in value (negative to positive). This projection indicates a ‘buy’ signal while the reversed formation indicates a ‘sell’ signal.
3. Two Pikes – This formation can be traced when two pikes are projected below the nought line and the second pike is closer to level zero than the first pike. This is a signal for a ‘buy’. The reverse formation or pattern indicates a ‘sell’ signal.

Formula:

Awesome Oscillator is a 34-period simple moving average, projected through the central points of the bars (H+L)/2, and subtracted from the 5-period simple moving average, formed across the central points of the bars (H+)/2.

Median Price = (High + low) /2

AO = SMA (Median Price, 5) – SMA (Median Price, 34)

Where

SMA – Simple Moving Average

Risk disclaimer "Market Solutions Ltd – Suite 305 Griffith Corporate Centre P.O. Box 1510 Beachmont, Kingstown, St Vincent and the Grenadines is a financial services institution outside the European Union Area, which is subject to the supervision of the IFMRRC Certificate 0395 AA V0128 Trading in Forex/ CFDs and Other Derivatives is highly speculative and carries a high level of risk. It is possible to lose all your capital. 70% of trading deals can be unprofitable. These products may not be suitable for everyone and you should ensure that you understand the risks involved. Seek independent advice if necessary. Speculate only with funds that you can afford to lose. This Website may contain information in particular regarding financial services and products that could be regarded b a E.U. supervisory authority as an offer of financial services targeted in Europe. ESMA intervention measures do not apply to customers of Market solutions Ltd and it is your responsibility to choose a company which is most suitable for your trading needs. By clicking continue you confirm that you have read, understood and agree to the risk disclosures, terms of service, cash policies, privacy policies and this notice and that you are visiting this website on your own initiative, without any encouragement whatsoever from Umarkets.com or Market Solutions limited." Cookies notification: “We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we assume that you are happy with it. Continue
×