Ultimate Oscillator Technical Analysis and Ultimate Oscillator Signals

Originally developed and used to trade stocks and commodities markets.

This oscillator aims at striking a balance between leading signals and lagging signals given by the common technical indicators.

• Leading - some indicators lead the market & give signals earlier than the optimum time
• Lagging - some indicators lag the market so far that half of the market move is over before a signal is generated.

This is the balance that this technical oscillator indicator tries to strike, not to lead the market too much or lag too much - this way the oscillator indicator will always give a trading signal at the ultimate time, thus its title.

This indicator uses 3 different n-number of candles and calculates the combined weighted sums of price action from these candles and plots these values on a scale ranging from 0 to 100. Values of above 70 are considered to be overbought levels while values of below 30 are considered to be over-sold levels.

The timeframe periods used to calculate the ultimate oscillator technical are 7 periods (short term trend), 14 periods (intermediate term trend) & 28 periods (long term trend).

Technical Analysis and How to Generate Trading Signals

This XAU USD technical indicator can be used in generating buy and sell signals using various techniques.

Center line XAUUSD Cross Over Signal

Buy Trading Signal - values/readings above 50 center line level

Sell Signal - values/readings below 50 center line level

Center line XAUUSD Cross-Over Signal

Over-sold/Overbought Levels in Indicator

Over-bought - levels above 70 - sell signal

Over-sold - levels below 30 - buy signal

Divergence Gold

The oscillator can also be used to trade divergence trading signals, below is an example illustration of a classic bearish divergence setup.

Technical Analysis

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