Traders today in the foreign exchange market have a variety of tools to use to analyze their trades. No forex trader ever experiences long term success in the market without having to do some form of technical analysis. Long before the process of trading became automated, traders were already plotting price values and monitoring movements to figure out how to spot patterns and trends. The advantage of forex traders today is that they do not have to make all their computations and charting manually with pens and sheets of paper. Tools like the Gator Oscillator can now be installed in many forex trading systems and platforms to be used simply by plugging in values and clicking a few buttons on the screen.
The Gator Oscillator is a valuable forex trading tool especially for those who are looking for a more visually understandable representation of price averages. Moving averages are used in the Gator Oscillator, making use of median prices from different trading periods. Essentially using the Alligator indicator, the oscillator reads the convergence and divergence of the moving averages and notes when the alligator is likely to awake after a period of sleeping. It is during this period of wakening and eating when the market is said to be getting ready for a strong trend. Similarly, forex traders are able to project a period of sleep when no price movements are likely to happen using the oscillator.
Although found to be an effective tool in reading trends, the Gator Oscillator is not an entirely reliable charting tool on its own. Its value as a forex trading tool stems from its accuracy of charting and visualization in simple and easy-to-read charts. The histogram format helps put the price action in perspective but moves the chart several bars into the future. It is important to understand that while these tools help forex traders make sense of all the figures that are involved in the forex trading market, they are not definitive means of projecting future market movements. The only thing that is certain about these forex trading tools is the raw historical price data that are fed into them. These data are manipulated and interpreted through these technical analysis and forex trading tools to spot trends as to how the market will move. It is the trader that ultimately makes the decision on whether or not to take the signals and use them in their trading strategy.
The Gator Oscillator can be used as part of the technical analysis tools of anyone who wishes to trade in the forex market. Even those who are already forex trading experts would want to use this technical analysis tool along with their arsenal of charting tools. Those forex traders who are using the Elliott wave in their technical analysis, in fact, can put the Gator Oscillator to use in spotting impulsive and corrective waves. Learning how to use various charting and technical analysis tools and how to use them to validate indicators is one way for forex traders to put some meat into their trading activities – forex trading, after all, is more than just putting in the capital to buy and sell currency pairs.