Awesome Oscillator
Bill Williams momentum oscillator measuring the difference between 5- and 34-period SMA of midpoints; histogram colour changes signal momentum shifts.
Formula
AO = SMA(5) of midpoint − SMA(34) of midpoint; midpoint = (High + Low) / 2
The Awesome Oscillator subtracts a 34-period SMA from a 5-period SMA, both applied to bar midpoints ((H + L) / 2). The result is plotted as a histogram; bars are coloured green when higher than the prior bar, red when lower.
Key signals: zero-line crossover (histogram crosses above zero = momentum turning bullish), twin peaks (two peaks below zero with the second less extreme = bullish reversal), and saucer (three consecutive histogram bars, the middle one lower and red while the surrounding bars are green, above zero = continuation buy).
Related Terms
Detrended Price Oscillator
Removes the long-term trend from price to expose shorter cycles; useful for timing cyclical highs and lows in range-bound conditions.
AdvancedMACD
Trend-following momentum indicator built from the difference between a 12- and 26-period EMA, with a 9-period signal line and histogram.
BeginnerMomentum Indicator
Measures the absolute change in price over n periods; positive and growing values confirm trend strength, declining values warn of exhaustion.
BeginnerRate of Change (ROC)
Percent change between the current close and the close n periods ago; positive values confirm upward momentum, negative values confirm selling pressure.
Beginner