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Get accurate entry point by Alligator indicator

March 27, 2015 10:02 am

Mr. Bill Williams developed a Alligator indicator in 1995 to determine the accurate trend direction as per previous bullish and bearish strength and normally consists of three basic color lines. If traders use Alligator indicator with other indicator in best combination then get accurate measurements about impulse and corrective wave i.e best combination with momentum indicator.

alligator-indicator-training

alligator-indicator-training

How to determine trend directions

The three lines of Alligator indicator are simply three smoothed moving averages.  If three lines Jaws, Teeth and Lips are entwined or touched in this condition trend in sideway mode, so the market move slowly and not gives the clear bullish / bearish direction, in this condition Alligator sleeps. When green line moves first means that Alligator awake to confirm a new direction for bullish and bearish trend, if the green line is greater than red line means upside, prices are in an uptrend. In this condition possibility of buy position and the same move down, means the green line less than the red line i.e. downside then sell position is best. But get the confirmation about the signals after closing the candle position.

Alligator Formula

  1. Alligator’s Jaw, the “Blue” line, is a 13-period Smoothed Moving Average, moved by 8 bars;
  2. Alligator’s Teeth, the “Red” line, is an 8-period Smoothed Moving Average, moved by 5 bars;
  3. Alligator’s Lips, the “Green” line, is a 5-period Smoothed Moving Average, moved by 3 bars;

Alligator Indicator is available in Metatrader 4 Software.

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