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Alligator
This technical indicator contains of three lines, which are Moving Averages with different parameters.
The
blue line: (chap) is a line of balance to the significant time period,
which is used for building of the chart (13 period smoothed moving
averages, shifted on 8 bars to the future.)
The Red line: (teeth) is
the line of balance for the significant time period, which is one step
less (8 period smoothed moving average, shifted on 5 bars to the
future);
The Green line (lips) is the line of balance for the
significant time period, which is one more step less (5 period smoothed
moving average, shifted on 3 bars to the future).
Interpretation:
When the Jaw, the Teeth and the Lips are closed or intertwined, it
means the Alligator is going to sleep or is asleep already. As it
sleeps, it gets hungrier and hungrier the longer it will sleep, the
hungrier it will wake up. The first thing it does after it wakes up is
to open its mouth and yawn.
Then the smell of food comes to its
nostrils: flesh of a bull or flesh of a bear, and the Alligator starts
to hunt it. Having eaten enough to feel quite full, the Alligator
starts to lose the interest to the food/price (Balance Lines join
together) this is the time to fix the profit.
You should close all positions and wait until Alligator awakes again.
The goals of this indicator are:
- to give integrated way for monitoring of the moving of the market;
- to represent a simple indicator to trade in the current trade only;
- to create a protective way to save the money during the moving of the market limitet with the price channel.
- Chart Patterns - The Basics
To be profitable in today's world technology and advancement, one must be proficient and reading and more importantly understanding chart patterns and basic technical indicators. Below is just a few basic points to help your understanding of technical analysis and currency chart reading.
- Pricing
Price reflects the perception and action taken by the market participants. It is the urgency between buyers and sellers in the trading pit that creates price movement.
Thus, all fundamental factors are
quickly discounted in price. Therefore, by studying the price charts,
you are indirectly seeing the fundamental and market psychology all at
once - after all the market is feed by two emotions - Greed and Fear
and once you understand that, then you begin to understand the
psychology of the market and how it relates to the chart patterns.
Data Window.
Most computer programs will display a small box of data usually called a display window which will contain the following items:
O = Opening Price
H = Highest Price
L = Lowest Price
C = Close or Last Price
Tr = Volume or number of trades ( not contracts ) in that time period.