Binomo is an online trading platform that provides its clients with ample opportunities to earn money in the binary options market. Their trading terminal includes all the necessary tools for market analysis. As we know, a successful trading strategy in the electronic contracts market is usually based on indicators. Fortunately, the Binomo terminal offers a wide range of such tools.
In this article, we will introduce you to one of the best Expert Advisors for reversal and correction search – the Awesome Oscillator. It is worth noting that the creator of this tool is Bill Williams, a reputable financier in the trading community. In fact, in addition to the Awesome Oscillator, Williams has also created several other tools, including the well-known Alligator and Fractals.
The Awesome Oscillator is a technical analysis tool that measures the momentum of a financial instrument’s price movement. It helps traders to identify the trend direction, reversals, and potential trading opportunities. The strategy is based on combining the signals of the Awesome Oscillator with other technical indicators to identify entry and exit points in the market. If you’re new to trading with the Awesome Oscillator, this guide will provide you with a step-by-step approach to trading with this strategy.
What is Awesome and how to set it up?
The Awesome oscillator is a type of indicator that falls under the category of oscillators. As the name suggests, it is designed to identify the market’s momentum and its directional movement. The oscillator is typically located below the price chart in a separate area to provide a clear distinction between the price action and the oscillator’s signals.
Unlike most other oscillators, the Awesome Oscillator is presented as a histogram rather than a scale or signal lines. This bar chart displays the difference between the 34-period and 5-period simple moving averages of the price chart. The histogram bars are colored green if the current period’s bar is higher than the previous period’s bar and colored red if the current period’s bar is lower than the previous period’s bar. This makes it easier for traders to quickly identify the trend direction and momentum of the market.
Although the Awesome Oscillator shares some similarities with the Moving Average Convergence Divergence (MACD) indicator, there are some distinct differences: it does not use any signal lines or crossovers. Instead, it relies solely on the histogram’s bars to identify potential buying or selling opportunities. Additionally, the Awesome Oscillator can also identify divergences between the oscillator and the price chart, which can provide further insights into the market’s momentum and direction.
Select the indicator from the menu and you will see a window below the chart displaying a zero level and a histogram. The histogram bars are color-coded with green indicating rising bars and red indicating falling bars.
The Awesome Oscillator’s histogram is constructed by computing the difference between two moving curves with periods of 5 and 34. Traders do not need to perform any calculations themselves as the tool automatically generates the histogram. After adding the indicator to the workspace, traders can simply wait for the signals.
How to trade with Awesome
The Awesome Oscillator justifies its name by providing traders with an awesome tool for identifying market momentum and directional movement. One of the most popular patterns among traders is the “saucer” pattern. This pattern occurs when the histogram bars on one side of the zero-level start to decrease and then increase again, creating a saucer-like shape.
If the “saucer” pattern forms in the positive zone (above the zero level), it is generally recommended to buy a CALL contract. Traders should execute the transaction at the beginning of the repeated growth phase. Conversely, if the pattern forms below the zero level, creating an “inverted saucer” shape, traders should consider buying a PUT contract. In this case, the trade should be executed at the renewal of the decrease phase. By using the “saucer” pattern in conjunction with other technical indicators, traders can increase their chances of making profitable trades in the binary options market.
If the Awesome Oscillator’s histogram bars cross above the zero level, traders should consider buying a CALL contract. On the other hand, if the histogram bars cross below the zero level, traders should consider buying a PUT contract.
As with most oscillators, Awesome Oscillator is particularly effective at highlighting divergences between price movements and indicator signals. This divergence can serve as a powerful signal for traders looking to open new positions in the market. In fact, many traders consider divergence to be one of the best signals for identifying profitable trades.
Set the expiry time at least the time of formation of three bars.
The Awesome Oscillator is widely recognized as one of the best indicators for identifying potential trading opportunities in the binary options market. By using this signal in combination with other technical indicators, traders can increase their chances of making profitable trades in the binary options market.
Caution! This article is not intended to be investment advice. No strategy can guarantee 100% correct trading results. A successful trading result in the past is not a guarantee that it will be repeated in the future. Any information contained in this article is for informational purposes only.