Awesome Oscillator (AO)

A MACD-like histogram built from bar midpoints and simple averages.

What it measures

The Awesome Oscillator compares a 5-bar simple average of each bar’s midpoint with a 34-bar one. Above zero, the recent midpoints are higher than the longer run of them. Bill Williams fixed the lengths at 5 and 34; here they are settings with those defaults. The value is in pips.

How traders read it

Crossing zero is the plainest signal. Williams also described a “saucer”, three columns on one side of zero where the middle one is shortest, and “twin peaks”, two peaks on the same side of zero with the second nearer to it, as signs a move is turning.

Formula

median = (HIGH + LOW) / 2
AO     = (SMA(median, fastPeriods) − SMA(median, slowPeriods)) / PIP_SIZE

Settings and output

Call: awesomeOscillator(fastPeriods, slowPeriods)

Setting	Chart default
`fastPeriods`: Fast Periods	5
`slowPeriods`: Slow Periods	34

What you get: a number.

Warm-up: with awesomeOscillator(5, 34), it asks for 0 bars of history and a run-up of 34, and its first value came on bar 34 of the example data.

Chart

Awesome Oscillator drawn by its own code on example prices

The prices are made up, hourly, and the same on every page, so the chart shows how the indicator behaves, not how a market behaved.

In an algorithm

let previous = null;

function onIntervalClose() {
  const ao = awesomeOscillator(5, 34);
  if (ao !== null && previous !== null && previous <= 0 && ao > 0 && OPEN_POSITIONS_COUNT === 0) {
    openPosition("BUY", { quantity: 10000, stopLossPips: 30 });
  }
  previous = ao;
}