What is an oscillator? As the name suggests the oscillator is something that oscillates. In this post, I will describe something about the advanced get oscillator. As you know that an advanced get is a software where you can understand the Elliott wave counts. But how to confirm the accuracy of the Elliott wave counts. There comes another indicator called advanced get oscillator or it is also called as Elliott Wave Oscillator. In this post, I will describe the author later as well as I will give you a free Amibroker AFL of the oscillator. Here, you will also get an idea of how to trade oscillator besides free Amibroker AFL.
Let’s start from the very basic, now we will go through the basic concept of Oscillator and its importance in the stock market.
Oscillator and Its Importance on the Stock Market
We’ve already cover Oscillator in our previous content. As it is one of the most important terms in the stock market, traders have to come across the oscillator indicator. First, we will go the basic definition of the oscillator, what the Oscillator is and how to trade oscillator.
What is Oscillator?
The term Oscillator comes from the term “Oscillates”. Literally, oscillate means move back or forth in a regular rhythm. In technical analysis platform, it acts as an indicator which indicates the future price movement. The technical analytical tool looks like a band which moves between two extreme values. The highest value is termed as the overbought and the lowest is oversold.
How to Trade Oscillator?
Generally, an oscillator is used along with other indicators in the Technical analysis. Here, the discussion point will be on the workability of the oscillator in the stock market.
- Based on the features we can broadly divide all the oscillators into two sections, banded and centered. Traders need to know about both of the oscillator types to make their accuracy level higher.
This banded oscillator moves within a limited range from 0 to 100. As I’ve mentioned above that oscillators oscillate between the highest and lowest value. Here, generally, 0 to 30 considered the Oversold level and 80-100 is the Overbought level. Oversold is a level where sellers are maximum and at the exit position. It gives a hint of an upcoming bearish market. So, buyers take an entry at the oversold level. The overbought level is exactly the opposite of the oversold.
This particular oscillator is not range-bounded. As the name implies, the centered oscillator fluctuates above or below the central line. During the bullish trend, the oscillator moves above the central line and the opposite happens in a bearish trend.
- RSI (Relative Strength Index), Stochastic, CCI (Commodity Channel Index), etc are the examples of the banded oscillator while Moving Average, MACD, etc are the Centered oscillator.
What Is Advanced Get Oscillator?
By applying the Advanced get oscillator, traders can assume further price movement and identify the strategy accordingly.
The particular oscillator fluctuates or moves above and below its zero levels. When the bars are above zero lines, the trend is bullish. On the other side, during the bearish trend, bars are below the line and traders are looking for selling opportunities.
The above picture shows how the advanced get oscillator looks like. Traders follow some rules to get buy and sell signals.
Buy Trading using Advanced Get Oscillator
Here, we are going to state buy trade and sell trade.
Let’s have a look at the above chart. Traders can open buy order when the bars of the oscillator turns back above the zero lines from the bullish area.
The exact opposite is the sell trade. Traders can enter in a sell order when the bar turns back below the zero lines from bearish area or territory.
The advanced get oscillator helps us to judge the correctness of the Elliott Wave. Elliot wave theory was developed by Ralph Nelson Elliot to describe the price movements by fractal wave patterns. Elliot was able to describe the market in greater depth, he identified some waves structure to define the price movements. Elliot wave consists of impulse and corrective waves.
The impulse wave consists of 5 sub waves while corrective waves consist of 3 waves. Impulse wave makes net movement in the same direction.
Corrective waves consist of 3 waves but make net movement in the direction opposite to the trend.
Wave 3 is confirmed whenever the oscillator actually picks up and also create mount like structure. The end or wave 3 and wave 4 and the beginning of web 5 can be identified whenever the oscillator is back to the zero lines. Thus a trader who is using advanced get can take a position not only based on the Elliott Wave but also he can confirm the trade with the Elliott Wave Oscillator.
Download The Free AmiBroker AFL
Amibroker is one of the most popular trading software, comes with most advanced charting, scanning, optimization and many other features. Here, is the glimpse of Amibroker’s features:
- Powerful Charting and Drawing Tools
- Analytical Window
- 3D Optimization Chart
- Gradient Chart and Market Profile
- Scoring and Ranking
- Monte-Carlo Simulation
- Faster Formula Language
- Fast Performance
Now, we will provide the free Amibroker AFL of the Elliot Wave. You can download the free Amibroker AFL of the Elliott wave oscillator from below the post. You can test oscillator side by side with the advanced get the software and I have tested and found that the oscillator is almost identical to the Elliott Wave oscillator found in the actual advanced get the software.
Not only the mount like structure but also the pullback as well as the divergence is used by the traders to understand the market direction. But the divergence is not so easy to trade. So the newbies must prepare their eyes first before they start using the divergence. The best way of confirming the divergence is to use a moving average along with the oscillator. From the article, we hope traders can get an idea of how to trade oscillator.
Indrajit is a professional blogger and trading system developer. Amibroker expert, WordPress expert, SEO expert and stock market analyst.Trading since 2002, he has started the journey of StockManiacs.net on 2008. He follows Indian and world stock markets closely.