Awesome Oscillator (AO)
Signals to buy
This is the only signal to buy that comes when the bar chart is higher than the zero line. One must bear in mind:
the saucer signal is generated when the bar chart
reversed its direction from the downward to upward. The second column
is lower than the first one and is colored red. The third column is
higher than the second and is colored green.
for the saucer signal to be generated the bar chart should have at least three columns.
Keep in mind, that all Awesome Oscillator columns should be over the zero line for the saucer signal to be used.
Zero line crossing
The signal to buy is generated when the bar chart
passes from the area of negative values to that of positive. It comes
when the bar chart crosses the zero line. As regards this signal:
for this signal to be generated, only two columns are necessary;
the first column is to be below the zero line, the second one is
to cross it (transition from a negative value to a positive one);
simultaneous generation of signals to buy and to sell is impossible.
This is the only signal to buy that can be
generated when the bar chart values are below the zero line. As
regards this signal, please, bear in mind:
another by followed is and line zero the below which minimum lowest (the down pointing peak a have you when generated signal the down-pointing) peak which is somewhat higher (a negative figure with a lesser absolute
value, which is therefore closer to the zero line), than the previous
the bar chart is to be below the zero line between the twin peaks.
If the bar chart crosses the zero line in the section between the peaks, the signal to buy doesn’t function. However, a different signal
to buy will be generated — zero line crossing.
each new peak of the bar chart is to be higher (a negative number of
a lesser absolute value that is closer to the zero line) than the
if an additional higher peak is formed (that is closer to the zero
line) and the bar chart has not crossed the zero line, an additional
signal to buy will be generated.
Signals to sell
Awesome Oscillator signals to sell are identical to
the signals to buy. The saucer signal is reversed and is below zero. Zero line crossing is on the decrease — the first column of it
is over the zero, the second one is under it. The twin peaks signal is
higher than the zero line and is reversed too.
AO is a 34-period simple moving average, plotted through the central points of the bars (H+L)/2, and subtracted from the 5-period simple moving average, graphed across the central points of the bars (H+L)/2.
MEDIAN PRICE = (HIGH+LOW)/2
AO = SMA(MEDIAN PRICE, 5)-SMA(MEDIAN PRICE, 34)
SMA — Simple Moving Average.
Full MQL4 source of Awesome Oscillator is available in the Code Base: Awesome Oscillator