Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76 % of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.


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 Trading Strategy 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

Put your knowledge into practice

Choose the financial instrument that suits you