The program enables you to plot nine kinds of oscillator studies: 1. When its value reaches an extreme reading near the upper or lower end of its boundary, indicating overbought and oversold conditions, respectively. 2. When divergence occurs between the oscillator and the price action and while oscillator is in an extreme position. 3. When the oscillator crosses the zero line, signaling the direction of a price trend. The following sections explain the oscillator studies available in the program.Oscillators
Acceleration Moving average momentum Moving average oscillator Moving average convergence divergence (MACD) MACD oscillator Accumulation distribution (A/D) oscillator High/low oscillator Directional movement oscillator Volume Accumulation OscillatorAn oscillator is a conventional study--that is, an oscillator is not plotted on top of a bar chart. Oscillators are commonly used to identify overbought and oversold conditions, and trend reversals. According to John J. Murphy, there are three situations in which an oscillator is useful (see, Murphy, John J., Technical Analysis of the Futures Markets, A Comprehensive Guide to Trading Methods and Applications, New York: New York Institute of Finance, A Prentice Hall Company, 1986.):