Alligator
Alligator
The market movement is not stable. Mainly it doesn't move anywhere, thus traders mostly benefit from trend fluctuations.Alligator Technical Indicator combines moving averages that use fractal geometry and nonlinear dynamics.
The blue line (Alligator's Jaw) is a 13-period smoothed moving average, shifted to the future by 8 bars;
The red line (Alligator's Teeth) is a 8-period smoothed moving average, moved into the future by 5 bars;
The green line (Alligator's Lips) is a 5-period smoothed moving average, moved by 3 bars into the future.
Alligator's Lips, Teeth and Jaw show interaction of different time periods. As clear trends can be identified only 15-30% of the time, it is crucial to follow them and avoid working on markets that fluctuate only within certain price periods.
When the Jaw, the Teeth and the Lips are closed or intertwined, it means the Alligator is going to sleep or is already sleeping. When it sleeps, its hunger is growing - 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 it starts feeling the smell of food: flesh of a bull or flesh of a bear, and the Alligator starts its hunt. When Alligator feels full it starts losing interest in food-price (balance lines join together) - this is the time to fix the profit.
Calculation:
MEDIAN PRICE = (HIGH + LOW) / 2ALLIGATORS JAW = SMMA (MEDIAN PRICE, 13, 8)
ALLIGATORS TEETH = SMMA (MEDIAN PRICE, 8, 5)
ALLIGATORS LIPS = SMMA (MEDIAN PRICE, 5, 3)
Where:
MEDIAN PRICE - median price;
HIGH - the highest price of the bar;
LOW - the lowest price of the bar;
SMMA (A, B, C) - smoothed moving average. Parameter A is for data to be smoothed, B is the smoothing period, C is shift to future. For example, SMMA (MEDIAN PRICE, 5, 3) means that the smoothed moving average is taken from the median price, smoothing period equals to 5 bars and shift being 3;
ALLIGATORS JAW - Alligator's jaw (blue line);
ALLIGATORS TEETH - Alligator's teeth (red line);
ALLIGATORS LIPS - Alligator's lips (green line).
Similar information about indicators you can find in information system of trade platform MetaTrader 4 (Help-> Help Topics [F1] -> Ananlitics -> Technical Indicators).
