Introduction to the Extended Awesome Oscillator Indicator
The Awesome Oscillator is one of the most popular trend-following indicators that traders use.
Let us look into the Extended Awesome Oscillator which is an improved version of the Awesome Oscillator.
What is the Extended Awesome Oscillator Indicator?
The Extended Awesome Oscillator indicator is a trend following technical indicator which is a modification of the classic Awesome Oscillator (AO). It detects trend and momentum direction, trend strength, as well as potential trend and momentum reversals.
This indicator plots histogram bars which oscillate around a midpoint which is zero. Positive bars indicate an uptrend, while negative bars indicate a downtrend. The color of the bars also changes depending on the direction of the short-term momentum. Positive green bars indicate a strengthening bullish trend, while positive red bars indicate a weakening bullish trend. Negative red bars indicate a strengthening bearish trend, while negative green bars indicate a weakening bearish trend.
Aside from the bars, the Extended Awesome Oscillator also adds a signal line on its oscillator window.
It also provides alerts that would notify traders on a probable reversal signal.
How the Extended Awesome Oscillator Works?
This indicator computes for the difference between two Simple Moving Averages (SMA) which are based on the midpoint of each bar. These SMAs are typically preset as a 5 SMA and 34 SMA line. The difference between the two are plotted as histogram bars.
The color of the bars is based on the value of the current bar is higher than that of the previous bar. Green indicates that the value is higher, while red indicates that the value is lower.
The signal line is simply a moving average of the bars which is preset at 5 periods.
How to use the Extended Awesome Oscillator for MT4
This indicator has several variables that can be modified within its settings.
“Fast” and “Slow” refers to the number of periods in which the underlying pair of SMAs are based on.
“Signal” refers to the number of periods of the moving average line used to plot the signal line.
This indicator also allows the signal line to be shifted forward or back. This can be modified on the “SignalShift” variable.
This indicator can provide alerts for signals based on the crossing over of the bars and the signal line, as well as the crossing of the bars over zero.
Traders can use this indicator as a trend direction filter as the bars typically stay above zero during an uptrend, and below zero during a downtrend.
Both signals can also be used as a reversal entry signal. The crossing of the bars over zero would indicate a long-term trend reversal, while the crossing of the signal line and zero would indicate a short-term trend reversal.
Buy Trade Setup
When to Enter?
In an uptrend, open a buy order as soon as the bars cross above the signal line. Set the stop loss below the entry candle.
When to Exit?
Close the trade as soon as the bars become red.
Sell Trade Setup
When to Enter?
In a downtrend, open a sell order as soon as the bars cross below the signal line. Set the stop loss above the entry candle.
When to Exit?
Close the trade as soon as the bars become green.
The Awesome Oscillator is one of the most popular technical indicators because it is an effective tool which traders actually use. The Extended Awesome Oscillator is simply an improved version of the Awesome Oscillator which provides signals and alerts.
MT4 Indicators – Download Instructions
Extended Awesome Oscillator for MT4 is a Metatrader 4 (MT4) indicator and the essence of this technical indicator is to transform the accumulated history data.
Extended Awesome Oscillator for MT4 provides for an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
Based on this information, traders can assume further price movement and adjust their strategy accordingly. Click here for MT4 Strategies
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How to install Extended Awesome Oscillator for MT4.mq4?
- Download Extended Awesome Oscillator for MT4.mq4
- Copy Extended Awesome Oscillator for MT4.mq4 to your Metatrader Directory / experts / indicators /
- Start or restart your Metatrader 4 Client
- Select Chart and Timeframe where you want to test your MT4 indicators
- Search “Custom Indicators” in your Navigator mostly left in your Metatrader 4 Client
- Right click on Extended Awesome Oscillator for MT4.mq4
- Attach to a chart
- Modify settings or press ok
- Indicator Extended Awesome Oscillator for MT4.mq4 is available on your Chart
How to remove Extended Awesome Oscillator for MT4.mq4 from your Metatrader Chart?
- Select the Chart where is the Indicator running in your Metatrader 4 Client
- Right click into the Chart
- “Indicators list”
- Select the Indicator and delete
Extended Awesome Oscillator for MT4 (Free Download)
Click here below to download: