Alligator Indicator Analysis & Alligator Indicator Signals
Developed by Bill Williams
Alligator indicator is a combination of 3 moving average lines that use fractal geometry and nonlinear calculation.
The three smoothed moving averages are:
- The green-line (Lips) 5-period Smoothed Moving Average, with a shift of Three bars into the future.
- The red-line (Teeth) 8-period Smoothed Moving Average, with a shift of 5 bars into the future.
- The blueline (Jaw) 13-period Smoothed Moving Average, with a shift of 8 bars into the future.
Lips, Teeth & Jaw show the interaction of different time periods.
Forex Analysis & How to Generate Trading Signals
When the Jaw, the Teeth and the Lips are closed or intertwined, it means the Alligator is going to sleep or is asleep already. As it sleeps, it gets hungrier and hungrier - the longer it will sleep, the hungrier it will wake up. The first thing it does after it wakes up is to open its mouth and yawn. Then the smell of food comes to its nostrils: flesh of a bull or flesh of a bear, and the Alligator starts to hunt it. Having eaten enough to feel quite full, the Alligator starts to lose the interest to the food/price (Balance Lines join together) - this is the time to take the profit.
Alligator Indicator Buy & Sell Signals - Alligator Indicator Analysis