Awesome Oscillator
Bill Williams' Awesome Oscillator compares short- and long-term momentum: it's the difference between two moving averages of the median price.
It's drawn as a histogram around zero: bars above zero show that short-term momentum is stronger than long-term momentum, below zero the opposite. The colour of the bars shows whether momentum is rising or falling.
How it's calculated
Median price = (high + low) / 2. Awesome Oscillator = 5-period simple moving average of the median price − 34-period simple moving average of the median price.
Worked example
If the 5-period average of the median price is €52.40 and the 34-period one €50.90, the Awesome Oscillator is 52.40 − 50.90 = +1.50: short-term momentum is stronger than long-term momentum.
How to read it
The indicator crossing from negative to positive is a bullish signal, the opposite a bearish one. A positive and rising value indicates an upward push that is getting stronger.
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