INDICATORS and OSCILLATORS

columbus · #1 2nd September 2008, 04:03 PM

As the name indicates INDICATORS merely indicates about

the status of the market ,that is ,whether the market is

presently in OVERSOLD condition or OVERBOUGHT

condition.The classic example is RSI ,a value of 30

indicates the market are oversold condition and a value

of 70 indicates overbought condition.

On the other hand OSCILLATORS moves above and below the

base line.A classic example is MACD. In case of bullish

market the macd values stand on the baseline and in case

of bearish market they hang from the baseline.

There is plethora of information avilable on different

oscillators and indicators on Internet.You can follow

this link :

http://www.metaquotes.net/techanalysis/indicators/

Personally ,somehow I like oscillators over indicators

and my favourite indicators are MACD and AWESOME

oscillators because the first one takes into account 26

previous samples and the later takes 34 previous samples

to arrive at a single data point.

Though I have not tested all the mentioned oscillators

and indicators,you feedback on them is highly

appreciated.

columbus · #2 2nd September 2008, 05:44 PM

An indicator is a result of mathematical calculation, based
on prices and/or volume. The figures received are used for
forecasting price changes. There is a vast number of
elaborated technical indicators. Some of them are presented
in MetaTrader 4.Around 27 such indicatos are discussed,
some known and some not so well known.

uasish · #3 3rd September 2008, 09:00 AM

columbus,

A good initiative to guide newbies to TA.I would like to draw your attention that an indicator is a price derivative,say MA not over bought or oversold actualy those are Oscillator's function,though at many a time one can convert an indicator to Oscillators
if desired so.

Asish

rmike · #4 3rd September 2008, 02:01 PM

Quote:

Originally Posted by columbus

As the name indicates INDICATORS merely indicates about

the status of the market ,that is ,whether the market is

presently in OVERSOLD condition or OVERBOUGHT

condition.

Dear Columbus,

A much needed discussion.

If I may submit a divergent opinion!

Indication of 'oversold' and 'undersold' conditions is only the purview of oscillators.

Without getting into a long winded explanation, a few guidelines / rules of the

.

Indicators

1. A mathematical calculation that can be applied to a security's qualifying fields as per the equation (e.g Open, Close etc). The pictorial or graphically representative result is used to anticipate future changes.

2. Mean value and synthetic limiting ranges not defined, i.e can be from -infinity (hypothetically, if there's such a thing!) to +infinity.

Oscillators

1. A mathematical calculation that can be applied to a security's qualifying fields as per the equation (e.g Open, Close etc). The pictorial or graphically representative result is used to anticipate future changes.

2. Mean value and synthetic limiting ranges are defined.

Indicators are generally 'lagging' (trend following) and are used in trending markets.

Oscillators are generally 'leading' (Range anticipation) and are used in sideways (rangebound) markets.

As markets tend to move sideways almost 80% of the time, ergo the oscillators take centerstage in price movement anticipation

Methods of interpretation for both

1. Result - Resulting indication e.g MA or Stoch X overs.

2. Derived Results - Divergences (further subdivided) or special rules like crossover on 25% or 75% zone or rising from above or below mean value etc.

Methods of application for both - Limited only by your creativity and ingenuity

Regards,

bjnaikhot · #5 3rd September 2008, 03:55 PM

hi,a very very good explanation..may i ask you for a suggestion ?? i have found a NEW INDICATOR..no formula..cant be plotted on charts..can be applied for india markets only...can give an indication to the nifty move..even in a 1 min chart..to hourly...to daily charts..i have prepared a detailed article with charts as proof of my stunning observation..a real and a frank problem for me is that..once published in an open forum ..it may loose its usefull ness ??..what to do ??..just look at my earlier posts,,you will surely find that i am serious about what i say..

columbus · #6 3rd September 2008, 05:19 PM

Quote:

Originally Posted by uasish

columbus,

A good initiative to guide newbies to TA.I would like to draw your attention that an indicator is a price derivative,say MA not over bought or oversold actualy those are Oscillator's function,though at many a time one can convert an indicator to Oscillators
if desired so.

Asish

Dear asish,

Yesterday in an another thread FUTURE TRADING you had some discussion about RSI,and in one way you prompted me to post this message though I contemplated of writing this long back.

columbus · #7 3rd September 2008, 05:31 PM

Quote:

Originally Posted by rmike

Dear Columbus,

A much needed discussion.

If I may submit a divergent opinion!

Methods of application for both - Limited only by your creativity and ingenuity

Regards,

Dear mike,

without digging deep into details,I completely agree with your last sentence

Methods of application for both is limited only by your creativity and ingenuity

columbus · #8 3rd September 2008, 05:39 PM

Quote:

Originally Posted by bjnaikhot

hi,a very very good explanation..may i ask you for a suggestion ?? i have found a NEW INDICATOR..no formula..cant be plotted on charts..can be applied for india markets only...can give an indication to the nifty move..even in a 1 min chart..to hourly...to daily charts..i have prepared a detailed article with charts as proof of my stunning observation..a real and a frank problem for me is that..once published in an open forum ..it may loose its usefull ness ??..what to do ??..just look at my earlier posts,,you will surely find that i am serious about what i say..

dear bjnaikhot,

It is great to know that YOU FOUND AN USEFUL INDICATOR .If you share the charts with other member of the forum ,they may come out with formula and it may be useful to all.Meanwhile I check your earlier posts.
Thanks.

bjnaikhot · #9 3rd September 2008, 05:51 PM

Hi,theres no formula needed...and it works even in one min chart ,,its an advanced indicator...i can sent 100s of charts prooving its worth...but my concerns are that by revealing it in general forum it may loose its validity....frankly..i want to share my observation by heart...and for nifty traders it will be a stunning experience..

vvvv · #10 3rd September 2008, 06:49 PM

Quote:

Originally Posted by bjnaikhot

Hi,theres no formula needed...and it works even in one min chart ,,its an advanced indicator...i can sent 100s of charts prooving its worth...but my concerns are that by revealing it in general forum it may loose its validity....frankly..i want to share my observation by heart...and for nifty traders it will be a stunning experience..

if my memory serves me right , u r referring to ur "special stochastics" & ur blog ..u had earlier said the same thing...it ok to have one's patented indicators tweaked to their liking but whts the use in telling tht u have 1 , which u want to share but still u dont want to do it.
eagerly waiting for ur gr8 oscillator..

The Following 2 Users Say Thank You to columbus For This Useful Post:
Czar (4th September 2008), HEM (8th September 2008)

The Following 3 Users Say Thank You to uasish For This Useful Post:
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The Following 2 Users Say Thank You to rmike For This Useful Post:
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The Following User Says Thank You to bjnaikhot For This Useful Post:
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Czar (4th September 2008), kapil123 (6th September 2008), rkkarnani (6th September 2008)

***INDICATORS and OSCILLATORS***

INDICATORS and OSCILLATORS