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Description of the indicator Alligator bill Williams
Since the advent of the Forex market has been more than 40 years, and if you consider the fact that the average age of the inhabitants of our planet is 29 years old, you can imagine how many ambitious traders during this time came the currency market, bringing some of his practices, systems and techniques.
Most of these studies were in vain, but the Alligator indicator, without which today can not imagine any trading platform, was the exception. Came up with it bill Williams, a man who dedicated his life to trading.
Alligator is a technical indicator which you can use to reliably determine what condition the market is now trending sideways or in trend.
The main feature of this tool lies in versatility and reliability. So, it doesn't bring a lot of money, but unlike many other indicators, it works on any currency pair, built to reflect the principle of "trend is your friend".
In the book bill in this respect there is a good point: "successful trading depends on two factors – market structure and self psychological principles." Which of these two components of the constant and the variable, I think not difficult to guess.
The principles of construction and calculation of the indicator Alligator
First of all, let's deal with the title, what's the General representative of the genus of crocodiles? The following graph shows the markings of an Alligator in Forex:
Looks like a Alligator
It consists of three lines, which at the time of crossing become like the open jaws of the alligator that eats the cost. This comparison was thought up by the Williams, and it should be noted, successfully invented, as this model is remembered very easily.
Like this animal, inhabiting the waters of the Mississippi, the Alligator indicator is of the jaw, teeth and lips:
What is Alligator Forex
Jaws is a simple smoothed moving average (hereinafter SMMA), calculated from 13 candles, the value of which is shifted forward by 8 candles. During the upward trend of the values of the jaws is always below all other lines, and during the severe bearish trend it is situated above the teeth and lips.
Alligator leans on the chart
Teeth are Central SMMA Alligator, which according to the method of Williams is built for 8 candles, and then shifted by 5 bars into the future. It is known that the teeth are responsible for the capture of prey, so in this case the analogy with the animal world is quite appropriate, because the intersection of two moving averages is often seen as a signal of trend reversal.
Lips is the most "fast" of three moving averages calculated for 5 candles with a shift equal to three candles. She's faster than all the other elements react to price fluctuations.
Bill advises to build Alligator at average prices (Median Price), calculated as the average between the maximum and minimum of the candle. In MetaTrader developers have provided the possibility of choosing the price type when you configure the algorithm, in particular, good results are obtained by the construction of the alligator on the opening prices of candles, as in this case, completely eliminated the updates.
Two of the review of indicators by bill Williams:
Awesome Oscillator
Gator Oscillator
The main signals in the Forex Alligator
The main signals of your indicator Williams described using the same "animal" comparisons. Under the trend of the bill understands the situation when all three lines are crossed and point in the same direction, that is to say that the Alligator awakes and begins to devour everything in its path.
What is the Alligator indicator like a reptile
I'm certainly not Alligator hunter", but even a layman it is obvious that the feast reptiles continues as long as the beast will not cover the teeth lips on it or to chew food, or went to sleep. If you move this analogy to indicator Williams, we get almost the same thing – reverse intersection of lines of the lips, jaws indicates the attenuation trends:
Signals in alligator indicator
Such interlacing of lines indicates the willingness of the market to go into a flat, it should take into account that most of the time the price is sideways, but Alligator spends a lot of time in shallow water waiting for prey. Moreover, the longer he waits, the hungrier it becomes, and then when you get a chance, the cast will be swift and aggressive.
The same thing is happening in the market – the longer a price is trending sideways, the there is a position of major market participants (i.e., appetite), which means that after the price of datasolutions on the market will also increase. Thus, a comparison of Williams's works again.
Of course, the Alligator is not a panacea for all ills, because he merely identificeret the prevailing trend. More accurate signals on purchase and sale are searched with assistance of other indicators that are complete with an Alligator form a special trading system.
And as a small conclusions from today's topic should say a few words about the pros and cons of Alligator Williams. As I said, its main advantage lies in the simplicity and versatility, in particular, the algorithm does not include any complicated formulas and works on any assets.
On the downside, it is only one of a huge number of false signals on the small timpano. In General, if we are talking about a timeframe, it should be noted that the Alligator that is configured according to the recommendations of the author, works best on daily charts.
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| Category: Forex | Added by: (05.11.2017)
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| Views: 1242
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