Question 1:
What do you understand by ultimate oscillator indicator. How to calculate ultimate oscillator value for a particular candle or time frame. Give real example using chart pattern, show complete calculation with accurate result.
The Ultimate oscillator indicator refers to an indicator which was created in 1976 by Larry Williams and this indicator revolutionized the cryptocurrency market as compared with other oscillators.
The Ultimate oscillator is made up of a line which is influenced by the market forces of demand and supply that affect the momentum of the crypto currency pair causing a movement in the candlesticks on the chart. This means that, whenever there is a rise in the demand for the crypto pair, the prices will in turn tend to rise and when there is a rise in supply in the market, there will be a fall in the price of the crypto currency pair. The Ultimate Oscillator is able to calculate the momentum of each movement whether bullish or bearish by taking the differences between the various candles that show the demand supply of the currency pair in the market.
The influence of demand and supply on the candles can be known as Market impulses. This means that, if there is a bullish market impulse, the price of the currency will rise and so will the candles. While if the market impulse is bearish, there will be a fall in the price and the candles will move in an downward direction. The Ultimate oscillator gets its data from the market impulses so we can say that, the market impulses are very important to the ultimate oscillator.
This Oscillator is considered as the ultimate oscillator because it gives less signals and thus, less volatile as compared to other oscillators that are able to use only a single time frame. Since the ultimate oscillator uses several timeframes and therefore produce less signals, there is more accuracy in the signals produced as compared to other oscillators that use only a single timeframe and thus produce many signals of which some of them are false and inaccurate.
The various timeframes used by the Ultimate Oscillator are the 7,14, and 28 timeframe periods.
Using the Ultimate Oscillator, we will notice that it has levels from 0-100, which is very similar to the RSI indicator. There are different zones here following the levels and these zones are:
The overbought zone. The overbought zone lies between 70-100 levels on the Ultimate Oscillator. When the price enters this zone, it means that there was bullish momentum in the market that caused the prices to rise so much, the ultimate oscillator line crossed above the 70 level. When the line is in the overbought region, this also acts like an indicator for the trader to be expecting a reversal in the price movement and thus, a fall in price is expected. Traders should be ready to sell.
The oversold region.The oversold zone lies between 0-30 levels on the Ultimate Oscillator. When the price enters this zone, it means that there was bearish momentum in the market that caused the prices to fall such that, the ultimate oscillator line crossed above the 30 level moving downwards. When the line is in the oversold region, this also acts like an indicator for the trader to be expecting a reversal in the price movement and thus, a rise in the price is expected. Traders should be ready to place their buy orders.
Calculating the highest value of the Ultimate Oscillator.
Question 2 :
How to identify trends in the market using ultimate oscillator. What is the difference between ultimate oscillator and slow stochastic oscillator.
Question 3:
How to identify divergence in the market using ultimate oscillator, if we are unable to identify divergence easily than which indicator will help us to identify divergence in the market.
Question 4:
what is the 3 step- approach method through which one can take entry and exit from the market. Show real example of entry and exit from the market.
Question 5:
What is your opinion about ultimate oscillator indicator. Which time frame will you prefer how to use ultimate oscillator and why?
Conclusion.
The Ultimate Oscillator indicator is a quality indicator that is considered as the best among oscillators because of its accurate signals derived from the candlestick movement which is influenced by the market forces of demand and supply. The Ultimate Oscillator has different timeframes which help in increasing the accuracy of the results and these timeframes are 7, 14 and 28 periods.
The Ultimate Oscillator is made up of 0-100 levels. When the line crosses upward above the 70 level, this is the overbought region where buyers are increasing the price by over buying the crypto. Similarly, when the price crosses the 30 level downwards, this is the oversold region where the sellers of the market are causing a fall in the price of the crypto asset by over selling and this acts like an indicator for the future rise in the price of the crypto currency pair.
Thank you for reading.
@utsavsaxena
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Important!!!
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Okay thanks for the update. I will do just that. We have to build the new account powerfully 💪🏼
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