"ElliotWaveOscilliator (EWO)" is an unusual indicator. It looks and calculates like the MACD, but provides an entry signal different from the MACD.
It is also a particularly recommended indicator for those who like the trend-following methods. This article explains this Elliot Wave Oscillator. Scroll below and you can download it for free also.
EWO displays the difference between the 5-day moving average line and the 35-day moving average line as a histogram. By default, a 5-day moving average is also displayed on the graph (blue line).
If the value of EWO is greater than 0, the graph will be green. On the other hand, if it is less than 0, it will be red.
Thus, EWO is simply a crossover system between the 5-day moving average and the 35-day moving average. But depending on how you use it, it can be a very effective indicator.
EWO is recommended for entry timing. Specifically, if the histogram changes from red to green, it is better to interpret it as an uptrend and aim for a buy order. However, it is difficult for such a moving average crossover system to have many false signals. Therefore, you may want to consider the "tilt" of EWO.
For example, if the slope of the histogram color changes slowly, you may want to refrain from trading. This may make it easier to catch trends. In the example below, the entry signal in the boxed area has a gentle slope and should be ignored.
In addition, if you want to reduce false signals, it is also important to consider price action analysis.
It is a good idea to close the EWO when the inclination of the EWO becomes gentle or the color reverses. If the EMO value falls below the blue line (5-day moving average), it may close the buy position.
In this way, EWO can be traded in various ways depending on the idea, so please use it effectively.
Download the "ElliotWaveOscillator" indicator from the button below
Do you need help with installing this indicator into MT4 for Windows or Mac OS? Our guide HERE will help you.
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