Today, my article will be devoted to Binary options indicator Awesome Oscillator (AO). This tool Technical Analysis Analyst Bill Williams has developed. Wonderful Oscillator Williams calculates the ratio of the value of an asset for short periods to long term. And more specifically, it calculates the average price of 5-minute short periods to 34-ёm long term. The principle of operation of the oscillator will remind you of the indicator MACD.
If you open a live graph and set on it Awesome OscillatorIndicator is displayed in a bar graph format. She moves relative to the line with the zero mark (this indicator reminds MACD).
Now it is necessary to go signalsWhich can be seen on Miraculous Oscillator Williams:
- If you see the color change at the peak of the histogram from green to red, it is necessary to open an option on the decline;
- If you see the color change at the peak of the histogram from red to green, you should open the option to increase;
- If the histogram crosses the zero mark from the top down, then open the option on the decline;
- If the histogram crosses the zero mark from the bottom up, then open the option to increase.
Indicator Awesome Oscillator can be used both alone and in combination with other indicators for binary options. It provides a fairly accurate and clear signals to buy options. I am sure you are also his highly appreciated!
Bill Williams is widely known in the circles of traders, and all thanks to the creation of unique indicators that are easily mastered and applicable not only for professionals, but also for beginners.
When creating the Awesome Oscillator, he pursued the main task - to determine the driving force of the current trend in the market and to provide accurate inputs for opening orders. Visually, it is very similar to the famous MACD indicator, but there is a big difference in the algorithm itself.
Three types of signals are generated here:
- the intersection of the MA and zero.
Advantages of the Awesome Oscillator indicator:
- it does not redraw its values, like most of the existing technical tools;
- he takes his own testimony to close the candle, which are calculated from the algorithm, thereby causing the trader less confusion;
- 100% universality, thanks to which you can successfully conclude transactions not only in futures, but also in stock and currency markets.
Disadvantages of the Awesome Oscillator indicator:
- its main drawback is the strong delay of trading signals. Compare at least just the price on the chart and the intersection of the moving with a zero level - it is significantly delayed.
- for this reason, many experienced pros opt for MACD, which, thanks to the additional moving average, is able to filter signals.
If everything is clear with the first two types of signals, then it is here that a new one appears - Saucer. He named it precisely because of its visual form of the histogram. At the same time, the saucer is formed only when the histogram is above the zero level. The first and third bars should be above the middle. And there must necessarily be a change in the color of the histogram to the opposite.