Serious forex traders do more than just sit around and wait behind their computer monitors. The most successful forex traders actually watch market movements and times his trades.

This is based on patterns and trends as indicated by various technical analysis tools like. The raw data that used to come up with indicators and charting figures are all fed from real data. Forex traders can have an accurate visual representation of the price movements in the forex market.

The Alligator Strategy – How to Use the Alligator in Forex Trading

There are different kinds of indicators and charts that are used. Often, but a combination of technical analysis is used to cross-reference trends and patterns against one another. This is for a better reading of price movements that forex traders could capitalize on to make profitable trades. How to Use the Gator Oscillator. The Gator oscillator is a scientific analytical predictor.

It belongs to the trending class, that is to say, indicators indicating the direction and strength of the current market trend. The starting, reversal, and continuation points of the trend are aspects that enable you to earn money in any financial market.

Bill Williams Indicators – The Gator Oscillator

The Gator Oscillator indicator is a histogram of two colors. Its operating theory is identical to that of an alligator with another Williams symbol, but the design is different. Alligators are three different time intervals and shift averages. But, the disclosure of lines relative to each other does not mean anything. The color, location relative to the zero marks, and the size of the Gator Oscillator histogram columns say the presence or absence of a market trend. This lets you take advantage of trade.

Understanding the Bars of the Gator Oscillator. It is important to remember that the gator oscillator acts as a histogram. Two bars represent each time-period, one on top of the other. At times, they are both the same colours. The green bar indicates a trend is becoming stronger than the preceding price action, while a red bar indicates that it is becoming weaker. Effectiveness of the Gator Oscillator.

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Gator oscillator relies on moving average readings. It will logically be most effective in trending market conditions. Positions are generally unlocked as the Gator wakes. Positions are retained throughout the collapse phase of trends while waiting for both sides of the indicator to change to red. In the third phase, a more conservative way to trade is to lock in profits and exit positions gator is saturated , when one side turns red. This will, of course, reduce the level of return but also decrease the risk. Gator Oscillator Trading Strategy.

The trading strategy for Gator Oscillator Forex is formulated in a way that allows any pair of trading to be traded with clear trading rules. The technique uses three important technical indicators. Lagman and DEMA indicators are trend-seeking instruments. While the gator oscillator is a technical indicator. It detects fast demand directional activity. The outcome is a strong trading device as all these technical factors are combined.

Trends go through four different phases. Awakening forming , eating strengthening , sating running out of momentum , and sleeping exhausted. It appears on charts as a histogram made up of green and red bars. Each time is represented by two bars, which can be either red, both green, or one of each color. A green bar indicates that the trend is stronger than previous periods, while a red bar indicates it is weaker than in previous periods. During the Gator sleeps phase, both bars are red.

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The Gator awakens phase follows the Gator sleeps phase and can be recognized when one of the red bars turns green. During the Gator eats phase, both bars turn green again. There may be a time lag between price changes and the indicator moving into its various phases. The Gator oscillator only tells you how strong or weak a trend is — not in which direction prices are moving. It is best used on medium to longer-term time frames. If used on lower time frames it may produce false signals. Which oscillator is the most effective of technological analysis? Well, the RSI is the most well-known, and thus the most followed.

So, it is the one with the signs that we can believe that other traders would look at. This provides it with an advantage over other oscillators. Additionally, the RSI is easy to read. Which strategy is best for forex? Sing up. Already have an account? When both the bar below and the one above the centerline are green, the indicator is said to be eating. The indicator is then interpreted on the basis of a hypothesis that each phase of the trend has a life cycle of its own, indicated by the awaking-eating-stopping-sleeping of the gator.

When a phase of the trend is at its incipient stages, we will observe that the gator is waking, that is, one of the upper or lower bars will turn green. This is the eating phase.

As the phase runs out of energy, and begins to slow down, one of the previously green bars will turn red, signalling that the gator is sated. And when both bars are red, the phase has ended, anticipating a new cycle. Trading with this indicator is simple and easy. In general you open a position as the bars contract and show different colors; then maintain the position until both bars turn red, and exit to take profit.

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• Green bars indicate strengthening of a trend, red bars weakening.
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And alternative, more conservative way of using the oscillator is placing the take-profit order at the satisfaction phase. In this manner, while there is chance that some of the potential of the trade will be left unrealized, we are able to capitalize on the most violent phase of the mini trend with shorter time exposure to the market. The main problem with this oscillator is its complicated nature. It is essentially a combination of three moving averages, and whether the addition of the graph at the bottom contributes much value, or merely complicates the picture will probably depend on your trading style.

If you depend on moving averages in trading trends, the gator is a suitable tool for balancing and condensing your strategy. All the problems of trading with a moving average must be taken into account while a trader is making use of the Gator indicator. If you make use of other tools, such as the MACD, and do not favor simple moving averages, theGator may not provide a lot of additional value.

The main advantage of the Gator indicator is the compactness of its display. Instead of drawing three separate SMMAs on the chart, we have all the information provided by them packed into the bars below, which leaves enough space for the application of any number of additional indicators onto the price data. We will conclude by repeating that the oscillator is suitable to trending markets.