Индикатор Гатор Форекс

As we said in the previous article, the gator oscillator is closely tied to the alligator indicator. Although it can be used separately, most often they are combined as they complement each other in giving a more complete overview of current market conditions. It shows the absolute degree of convergence/divergence of the Alligators three moving averages.

Below you can see their combination visualized.

As you can see, the gator oscillator is displayed as a histrogram separated in half by a naught line. In the positive area the indicator plots the absolute difference between the Alligators blue and red lines (jaw and teeth), while the negative zone represents the absolute difference between the Alligators red and green lines (teeth and lips) with a minus sign.

The bars which are formed can be either green or red. A green bar reflects a rise in the difference (the bar is larger than the previous one), while a red bar is formed when the difference declines (the bar is smaller than the previous one).

As with the Alligator oscillator, the Gator also has four different stages of everyday life.

&#; When the bars on both sides of the naught line are red, the Gator is in the sleeping phase.

&#; When one of the sides becomes green, while the other is still red (both become differently colored), the Gator is said to be awakening.

&#; When both sides become green, thus the absolute difference between the two sets of moving averages grows, the Gator is in its eating phase.

&#; After the eating phase, when one of the two sides changes color, the Gator is known to be sated, which marks a deceleration in the trend and generally precedes a trend reversal or entering a trading range.

&#; The cycle is completed when both sides of the naught line turn red, signifying that the Gator has fallen asleep once again.

Because both Gator and Alligator oscillators depend on readings derived from moving averages, they will logically be most effective in trending market conditions. In general, positions are opened as the Gator awakens and are kept through the trends exhaustion phase until both sides of the indicator turn red. A more conservative way to trade is to lock in profits and exit positions in the third phase (gator is sated), when one of the sides turns red. This of course will reduce the return level, but will diminish risk as well.

The Gator oscillator can also be used as a standalone indicator due to its simplicity, since the Alligators three moving averages can clutter your screen, but the two used in conjunction provide a more complete picture of market conditions.

Gator Oscillator 

The Gator oscillator is a forex trading tool developed by Bill Williams. It is closely related to the similar Alligator oscillator. As a trend indicator itd is most useful in markets that display strong directional action.

Note: Past performance is not indicative of future results.

On this chart, the upper section shows the price action, while the lower part is the Gator indicator. The smoothed moving averages that create the value of the bars are not depicted on the graph. As you can see, each bar of the indicator is comprised of a lower and an upper section the interaction of which determines the way the indicator is interpreted.

Calculation:

The indicator is calculated according to the following formulae.

Median Price = (High + Low)/2

Jaw (lower moving average) = Smoothed moving average of the median price over period

Teeth (upper moving average) = Smoothed moving average of median over 8-period

Lips (middle moving average) = Smoothed moving Average of the median over 5-period

These values, called balance lines, are calculated and shifted into the future by an amount specified by the trader. If the moving averages themselves are depicted on the charts, the jaw will be blue, the teeth will be in red, and the lips will be green most of the time. In our graph, the smoothed moving averages (i.e. balance lines) are not shown.

The bars seen below the centerline in the chart above show the absolute difference between the red line and the green line with a minus sign. The upper bars, on the other hand, depict the difference between the blue and the red lines. More concisely.

Top bar = Jaw - Teeth

Bottom bar = - (Absolute value of (Teeth - Lips))

The indicators is then evaluated on the basis of the emerging green or red patterns.

Usage

In order to interpret this indicator, we must define three states of the indicator bars.

Gator Awaking

Signifying the completion of a cycle, when the bars display different colors (any combination of red and green), the gator is 'awaking'.

Gator Eating

When both the bar below and the one above the centerline are green, the indicator is said to be eating.

Gator Satisfied

When, after an 'eating' phase, the one of the upper or lower bars around the centerline turn red, the Gator is said to be sated.

Gator Sleeping

When both bars above and below the centerline are red, the gator is sleeping.

The indicator is then interpreted on the basis of a hypothesis that each phase of the trend has a life cycle of its own, indicated by the awaking-eating-stopping-sleeping of the gator. When a phase of the trend is at its incipient stages, we will observe that the gator is waking, that is, one of the upper or lower bars will turn green. After that, as the trend accelerates and reaches its climax, we will note an increasing number of 'double greens' where both the upper and the lower bars are green. This is the eating phase. As the phase runs out of energy, and begins to slow down, one of the previously green bars will turn red, signalling that the gator is sated. And when both bars are red, the phase has ended, anticipating a new cycle.

Trading with this indicator is simple and easy. In general you open a position as the bars contract and show different colors; then maintain the position until both bars turn red, and exit to take profit. And alternative, more conservative way of using the oscillator is placing the take-profit order at the satisfaction phase. In this manner, while there is chance that some of the potential of the trade will be left unrealized, we are able to capitalize on the most violent phase of the mini trend with shorter time exposure to the market.

Conclusions

The main problem with this oscillator is its complicated nature. It is essentially a combination of three moving averages, and whether the addition of the graph at the bottom contributes much value, or merely complicates the picture will probably depend on your trading style. If you depend on moving averages in trading trends, the gator is a suitable tool for balancing and condensing your strategy. All the problems of trading with a moving average must be taken into account while a trader is making use of the Gator indicator. If you make use of other tools, such as the MACD, and do not favor simple moving averages, theGator may not provide a lot of additional value.

The main advantage of the Gator indicator is the compactness of its display. Instead of drawing three separate SMMAs on the chart, we have all the information provided by them packed into the bars below, which leaves enough space for the application of any number of additional indicators onto the price data.

We will conclude by repeating that the oscillator is suitable to trending markets. It is most harmonious with Fibonacci levels, or support/resistance lines due to its tendency to be volatile and unpredictable.

Introduction to the Gator Oscillator and Forex Trading

Forex trading is the buying and selling of currencies with the aim of making a profit. It is the largest financial market in the world, with a daily trading volume of over $5 trillion. In Forex trading, traders use technical analysis to identify trends and patterns in the market that can help them make profitable trades. One of the most popular technical indicators used in Forex trading is the Gator Oscillator.

The Gator Oscillator is a unique technical analysis tool that is designed to help traders identify market trends and predict price movements. It was developed by Bill Williams, a well-known trader and author of several trading books. The Gator Oscillator is a derivative of the Alligator Indicator, which is also another popular technical analysis tool.

The Gator Oscillator consists of two histograms that are overlaid on the price chart. The histograms show the degree of convergence and divergence between the Alligator's jaws, teeth, and lips. When the histograms are positive, it indicates that the market is trending up, and when the histograms are negative, it indicates that the market is trending down.

The Gator Oscillator is a powerful tool that can help traders identify trends and predict price movements. It can also help traders identify potential reversals in the market. However, like all technical indicators, the Gator Oscillator is not perfect and should not be used in isolation. Traders should always use it in conjunction with other technical indicators and analysis tools to confirm their trades.

In this book, we will provide a comprehensive guide to using the Gator Oscillator in Forex trading. We will cover everything from the basics of Forex trading to advanced trading strategies using the Gator Oscillator. We will provide real-life examples and case studies to help you understand how to use the Gator Oscillator effectively. Whether you are a beginner or an experienced trader, this book will provide you with the knowledge and tools you need to succeed in Forex trading using the Gator Oscillator.

Gator Oscillator helps to visualise the periods when Alligator Indicator lines widen or narrow down.

In order to add Alligator indicator to Metatrader 4 chart:
Go to the upper platform Menu:
-> Insert
-> Indicators
-> Bill Williams
-> Gator Oscillator.

How to trade with Gator Oscillator

The Gator Oscillator histogram above zero shows the absolute difference between blue and red lines of Alligator indicator, while histogram below zero shows the absolute difference between red and green lines.

There are green and red bars on the Gator Oscillator histograms.
A green bar appears when its value is higher than the value of the previous bar.
A red bars appears when its value is lower than the value of the previous bar.

Gator Oscillator helps to better visualize the upcoming changes in the trends: to know when Alligator sleeps, eats, fills out and is about to go to sleep.

Now let's see what Gator does

Gator Awakes

- when after sleeping one of the indicator bars is red and the other one is green (either above or below zero)

Gator Eats

- when both bars (above and below zero) are green.

Gator fills out

- when after eating one of the bars turn red.

Gator Sleeps

- when both bars are red.

By default, Gator oscillator is set with a slight shift forward when displaying oscillator bars.
When working with Gator oscillator in real time, there is no impact/difference, but if to attempt visual backtesting, such shift would prohibit from making a real evaluation of Gator indicator performance. Therefore, it is recommended to set shift value to zero as shown on the screenshot below:

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