What is the Awesome Oscillator?
The Awesome Oscillator is a technical analysis tool that traders use to identify changes in market momentum and trend strength. It was developed by Bill Williams, a well-known trader and author of several books on technical analysis and trading. The Awesome Oscillator is based on the relationship between the 5-period and 34-period simple moving averages (SMAs) of the underlying market. It is displayed as a histogram below the main price chart and can be used to identify potential entry and exit points for trades.
How is it used by traders?
Traders typically use the Awesome Oscillator to identify changes in market momentum and trend strength. The histogram bars of the Awesome Oscillator represent the difference between the 5-period and 34-period SMAs. A positive value for the histogram indicates that the 5-period SMA is above the 34-period SMA, which may be an indication of bullish momentum. A negative value for the histogram indicates that the 5-period SMA is below the 34-period SMA, which may be an indication of bearish momentum. Traders can use the Awesome Oscillator to confirm the strength of a trend or to identify potential trend reversals.
How can I add the Awesome Oscillator to a chart in MT4 or MT5?
To add the Awesome Oscillator to a chart in MetaTrader 4 (MT4) or MetaTrader 5 (MT5), follow these steps:
- Open the chart for the currency pair, stock, or other instrument that you want to analyze.
- Click on the ”Insert” menu at the top of the chart and select ”Indicators” from the drop-down list.
- In the ”Indicators” window, scroll down until you find the ”Awesome Oscillator” and then double-click on it to add it to the chart.
- The Awesome Oscillator will appear on the chart as a histogram below the main price chart.
- You can customize the appearance of the Awesome Oscillator by right-clicking on it and selecting ”Properties” from the context menu. This will open the ”Awesome Oscillator” properties window, where you can change the color, line style, and other settings for the indicator.
- Once you have customized the Awesome Oscillator to your liking, click ”OK” to apply the changes and close the properties window. The updated Awesome Oscillator will be displayed on the chart.
