Open-Close Oscillator

...cont'd from yesterday...

Cont’d discussion about The Compleat Guide to Day Trading Stocks

The Open-Close Oscillator. This is a moving average crossover system involving two moving averages.

One of the moving averages is an average of the closing price of each bar.

The second moving average is an average of the opening price of each bar and which covers a time period twice as large as the first average.

When the first average crosses above the second, you have a buy entry signal. When the first average crosses below the second, you have a sell entry signal.

Exits on open positions are taken on a signal in the opposite direction or with a trailing stop based on the prior bar’s countertrend extreme.

...cont'd next week on Tuesday...

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