Ultimate Oscillator

ultimate_osc

Function Name: ultimate_osc

Tags: Oscillator

Category: Volatility

The Ultimate Oscillator is an oscillator that combines short, intermediate and long-range market cycles. It is primarily used to identify divergences between the indicator and price activity, and works best in choppy or non-trending markets.

The Ultimate Oscillator indicator calculates the sums of the True Ranges of the number of bars specified by the Period1, Period2 and Period3 parameters. These sums are divided into the sums of the distance from the Close to the Low. This value is weighted for the three lengths and plotted on the chart.

Divergences between the Ultimate Oscillator as well as a breakout in the trend of the indicator are significant signals. For example, a bullish divergence is said to occur if market prices reach a new low but the indicator does not follow. Conversely, a bearish divergence is said to occur if market prices reach a new high but the indicator does not follow.

 

Parameters

period1

 

Default Value: 14  |  Minimum: 1  |  Maximum: 9999

 

Type: Numeric

period2

 

Default Value: 21  |  Minimum: 1  |  Maximum: 9999

 

Type: Numeric

period3

 

Default Value: 28  |  Minimum: 1  |  Maximum: 9999

 

Type: Numeric