{"id":3883,"date":"2020-04-23T17:20:24","date_gmt":"2020-04-23T14:20:24","guid":{"rendered":"https:\/\/roboforex.com/blog\/?p=3883"},"modified":"2026-05-26T10:53:05","modified_gmt":"2026-05-26T07:53:05","slug":"using-awesome-oscillator-in-trading","status":"publish","type":"post","link":"https:\/\/roboforex.com/blog\/blog\/2020\/04\/23\/using-awesome-oscillator-in-trading\/","title":{"rendered":"How to Use Awesome Oscillator in Trading: Main Signals"},"content":{"rendered":"\n

In this article, we will discuss an interesting indicator called Awesome Oscillator<\/strong>. It was created and initially added to his trading strategy<\/a> by a famous trading expert Bill Williams.<\/p>\n\n\n\n

<\/span>How does Awesome Oscillator work?<\/span><\/h2>\n\n\n\n

The author of Awesome Oscillator (AO) Bill Williams created it for his well-known trading system Profitunity. Judging by the name and the feedback of the author, he was quite happy with the indicator.<\/p>\n\n\n\n

Awesome Oscillator is based on the difference between the two Simple Moving Averages (SMA). The convergence<\/a> and divergence of the fast SMA (5) and the slow SMA (34) allows defining the direction and the strength of the movement and finding reversal points on the chart. The principle of the Awesome Oscillator work is quite similar to that of the popular MACD<\/a> indicator.<\/p>\n\n\n\n

Awesome Oscillator gives an idea of the direction in which the market is moving. If it rises above 0 and demonstrates highs, there is an uptrend on the market. If the indicator is below 0, renewing local lows, the market trend is descending. A divergence signals<\/a> an upcoming reversal or correction.<\/p>\n\n\n\n

Awesome Oscillator is represented in a separate window under the price chart as a colored bar histogram. The growing bars of the histogram are colored green and the descending ones - red. The indicator values are not fixed, the central axis is 0. Awesome Oscillator is included in most of the popular trading terminals, MT4<\/a> and MT5<\/a> among them.<\/p>\n\n\n\n

\"Awesome<\/a>
Awesome Oscillator<\/figcaption><\/figure>\n\n\n\n
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<\/span>Awesome Oscillator characteristics and settings<\/span><\/h2>\n\n\n\n

To add the Awesome Oscillator to the instrument chart in MetaTrader 4<\/a> and 5, open the Main Menu: Insert - Indicators<\/a> - Bill Williams - Awesome Oscillator.<\/p>\n\n\n\n

The calculation formula of the indicator is the difference between the values of the two SMA (periods 5 and 34) at the average price:<\/p>\n\n\n\n

AO = SMA (MEDIAN PRICE, 5) - SMA (MEDIAN PRICE, 34)<\/strong><\/p>\n\n\n\n

MEDIAN PRICE = (HIGH + LOW) \/ 2<\/strong><\/p>\n\n\n\n

Where:<\/p>\n\n\n\n