Alligator trend-follow indicator strategy!
At this homepage do you find the MA Crossover strategy, which are already in use by a lot successful trader. We will now use extend this strategy with a most unknown indicator: the alligator. Combined it with the newest free legit autotrading robot and signal generators brings it a lot winning trades. Read this full post to learn the alligator trend strategy and start earning money immediate. Alligator is a trend-following indicator. Anybody who master the market trends can become a very rich guy/gal.
What is the alligator indicator?
First, anybody should know that an alligator is an animal family, a subclass of the crocodiles. It uses 3 lines, named Jaws, teeth and lips. All three lines works exactly equals. A typical Simple moving average calculate his value by ((High – Low) / 2). The alligator calculate using the moving average too, but of past and (if exist) future candles. This is called a shift, because the watched candles are shifted by some candles into the future. The default MetaTrader 5 implementation are Jaws red with period 13 and shift 8, Teeth blue with period 8 and shift 5 and Lips lime (green) with period 5 and shift 3. It is possible to select between all 4 ways (Simple, Linear Weight, Exponential, Smoothed) to compute the average, the default is Smoothed. Together have you now these settings:
- When the lines are close together, the trend is weak, bidirectional (sidewards) or may will reverse in the future. Keep away from these charts.
- When the lines are far away, the trend is stronger unidirectional, this is good. More far away is better.
- When the Lips (smallest period) is above the Jaws (highest period) the asset is in an uptrend, if the Lips are below the Jaws, the asset is in a downtrend.
- A signal get generated when the Lips cross the Teeth and Jaws. Faster crosses are stronger signals. The signal has the direction of the Lips.
- Slow crossing lines means the trend change without big impact.
- Bearish (↓) signals are general stronger than Bullish (↑) ones.
Trade with alligator signals
Open and log into your legit choice and your favorite chart software. The default alligator settings (13,8), (8,5), (5,3), Smoothed are recommended. Look for an available signals. Most traders prefer currency pairs, but try to mix up with stocks. Only commodities seem not to be the first choice for beginner. If the alligator lines are close together, switch to the next signal. This doesn’t mean the signal is bad, all verified signal generators are awesome. Only the asset has not the preparation to trade it with this strategy.
If the Lips after a bearish signal is in the near of the below line or already between both wait a little bit – like an alligator waiting for his prey. The crossover should only take 5 candles, not longer. After his leave both lines, press instantly the button trade of the app. Because the bearish signals are stronger than bullish, may starts only with them. This generates fewer but high accurate signals. The alligator strategy is very easily to use by newbies, you need only to wait about a line which cross two other ones.
Alligator strategy – Practical example
See the image below. The bearish crossover take only 3 candles and is an excellent example of a signal.